GBP/USD Price Forecast – GBP/USD To Trade Range Bound As Both Sides Fight For Upper Hand

GBPUSD pair continues to be dominated by Brexit proceedings regardless of dollar’s strength in broad market despite Dollar’s price dynamics having some impact on pound bulls amid holiday thin trading volumes. Brexit remains a key event for the European continent as the two sides barrel towards the final Brexit date slated for March 29th of 2019, and many active watchers are growing increasingly irritated as UK Prime Minister Theresa May continues to play keep-away with her current Brexit withdrawal proposal which still awaits a parliamentary vote, which PM May recently canceled at the last-minute and is now running down the clock in the hopes of forcing naysayers to agree to her plan, which has failed to garner much support from either side of the Brexit line.

US Market Hours To Provide Short Term Opportunities On Macro Data Release

As of writing this article, GBPUSD pair is trading at 1.2651 up by 0.15% on the day. Amid holiday season trade supported by US political woes GBP bulls staged a slight recovery yesterday but spike in US Treasury Yields and Wall Street recovery supported US Greenback in broad market which pulled down the pair from intra-day lows. The pair is now trading range bound as increased risk appetite in market following Wall Street rally and positive performance in Asian equities signal positive price action in European markets and back Pound bulls while USD Strength in broad market also fights for momentum which has blocked any chance for GBP to stage a sharp upside move. The pair is expected to continue trading flat in European market hours, but US market hours should provide short term profit opportunities for retail traders owing to release of first tier data.

While UK’s calendar is silent for the day US market has two first tier data releases – CB Consumer Confidence and New home sales data with mixed forecasts. When looking from technical perspective, the 4 hours chart paints bearish short-term picture as the pair broke below ascending trend line and 20 SMA turning lower at around 1.2670, while technical indicators entered negative ground, although with limited momentum amid the lack of volatility. The pair has an immediate support at around 1.2605 where it has several daily lows from these last few days, with the bearish case turning firmer on a break below it. Expected support and resistance for the pair are at 1.2605, 1.2555, 1.2510 and 1.2670, 1.2710, 1.2745 respectively.