GBP/USD Daily Fundamental Forecast – October 23, 2017

The GBPUSD pair recovered well towards the second half of Friday and managed to close near the 1.32 region which now points to the possibility that this week could serve to be better for the pound bulls. The trading in the pair was choppy at best, as far as last week was concerned, as the trend continued to point downwards but everytime the pair moved downwards, it was met by some strong buying which managed to push the pair back above.

GBPUSD Looks Higher

This kind of bounces are the ones that have kept the bulls interested in this pair and also prevented the pound from crashing altogether. On the other hand, the pound has also drawn strength from the progress in the Brexit talks, which had hit a roadblock over the last few weeks. The UK PM May traveled to Brussels to push the talks in the right direction and though there has not been any significant progress as yet, we can see some positive signals arising from the talks and it is expected that the deadlock in the talks would be broken in the coming weeks.

This has helped to keep the pound buoyant despite the strength in the dollar and the data from the UK last week also came in as per expectations which has kept the fears of an economic slowdown at bay, atleast for now. The inflation came in as per expectations and though, any rate hike in the near future is not expected to happen, it keeps the options open as far as the BOE is concerned and this is likely to keep the pound in high spirits for the short term.

Looking ahead to the rest of the say, we do not have any major news from the UK and the US and this is expected on the first day of the week. We expect some consolidation and ranging to happen in the pair for the rest of the day as the market prepares itself for the bigger battles ahead.