GBP/USD Price Forecast – GBP/USD On Path For Steady Downside Move

The GBPUSD pair has been on steady albeit slow downside price action since the trading session started for the week. While hopes for the possibility of delaying article 50 deadline continues to prevent a sharp decline in the immediate future, a clear of events proceeding in either direction on Brexit front is weighing down GBP. A no-deal exit from EU is an outcome that will devastate both economies and fears of no-deal exit is finally starting to grow in the market given lack of time for UK lawmakers to make critical decisions and UK Prime Minister Theresa May’s intentional delay and sabotage tactics displayed in recent past to have her way in regards to Brexit proceedings.

BOE Carney’s Speech To Provide Directional Bias

This combined with the fact that USD is growing strong in the broad market with each passing day regardless of increased risk appetite in global markets is weighing down British Pound significantly. USD bulls are currently supported on their positive price run by a strong upsurge of US Treasury bond yields. Trade optimism surrounding Sino-U.S. talks has created a bullish environment for US bond and equity markets and this is in-turn supporting Dollar’s positive momentum in the global market. This has led to a steady decline in the GBPUSD pair over this week. As of writing this article, the GBPUSD pair is trading at 1.3154 down by 0.24% on the day.

Moving forward, while Brexit progress and headlines may control overall price action, the pair is likely to see further declines and even when considering the chance for recovery price action above 1.3200 handle is unlikely owing to Brexit progress scenario entering a state of the lull. As USD grows stronger the pair will face further declines and in immediate future, investors are eyeing macro data updates for short term profit opportunities. On the release front, the UK economic calendar is scheduled to see the release of Services PMI and a speech by BOE governor Mark Carney later in the day. Meanwhile, the US calendar is scheduled to see the release of new home sales data, ISM Non-Manufacturing PMI and Markit Composite & Services PMI updates. In the case of disappointing macro data outcome, the pair will enter consolidative price action for a short while. However, investors are on the lookout for Carney’s speech for directional bias and in case his speech displays a positive tone hinting at a delay in Brexit deadline the pair will move back towards 1.3200 handle while dovish comments will push the pair towards 1.3100 handle during American market hours.

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