GBP/USD Daily Fundamental Forecast – April 05, 2017

The GBPUSD pair continue to consolidate and trade between 1.24 and 1.25 as the markets are in a wait and watch mode ahead of the FOMC meeting minutes and also the rest of the data that is scheduled to be released later today and also in the coming days of the week. We had mentioned the same in our forecast yesterday as well as we had said that the markets are likely to be slow and less volatile as the traders prepare their positions for the upcoming data and thats what we have been seeing over the last couple of days.

GBPUSD Prepping Itself for Bigger Battles

We also had the release of the PMI data from the UK which was largely along expected lines and this helped to reduce a bit of panic selling that had set in the pound due to the bad data that was released on Monday.  The pound traders are on the edge as the Brexit process has officially begun and with no one sure on what to expect and how the negotiations between the UK and Euro leaders are likely to go, the traders are not sure whether to go long or short on this pair and have begun to depend a lot on the incoming data so that they can form their opinion on how the economy is doing.

The GBPUSD is expected to be weighed down by the pressure of the uncertainty surrounding the Brexit process and initially we can expect the UK people to reduce their spending in anticipation of the worst. Only when more and more clarity emerges will everyone begin to understand the true impact of the Brexit and only then a real assessment of the economy can take place.

Looking ahead to today, we have the services PMI data from the UK and we also have a host of data from the US including the ADP Employment change, the non-Manufacturing PMI and the FOMC meeting minutes very late in the day. All this shall ensure a lot of volatility in the GBPUSD pair which is likely to continue to remain bid with 1.26 proving to be a line in the sand for the bulls and the bears.