- GBP/USD is struggling to take advantage of the rise during the day amid modest USD.
- Outlook Divergent Fed-Boe contributes to determining the currency pair.
- The preparation appears to be in favor of bears and supports deep losses.
The GBP/USD pair returns to a few points from the lowest level of the Asian session and is currently trading around the round of the round shape 1.2400, and has not changed almost today. However, the bullish trend is still heading in the wake of a modest force in US dollar (USD), which in turn calls for some caution to the upcoming traders.
US President Donald Trump’s threats enhance the fresh tariff enhances the demand for traditional armed greenery. Meanwhile, the optimistic US employment details that were issued on Friday should allow expectations that Trump’s protectionist policies will lead to increased inflation, and should allow Federal Reserve (Fed) to retain rates steadily and provide additional support to the US dollar. Regardless of this, the dark expectations of England should contribute to the customization of the GBP/USD pair.
Even from a technical perspective, the recent frequent failure near the simple moving average for 50 days (SMA) indicates that the less resistant path for the GBP/USD pair is the downside. Thus, any subsequent move can be considered as the opportunity to sell and remain wrapped near the Psychological brand 1.2500. The latter should be a major pivotal point for the short -term traders, which, if wiping decisively, should pave the way for additional gains in the near term.
The GBP/USD pair may then accelerate the positive movement towards the 1.2575-1.2580 on its way to the round 1.2600. The momentum can extend beyond that about 1.2645-1.2650 intermediate obstacle, which can aim instant prices to the SMA challenge for 100 days, which is currently linked near the 1.2715-1.2720 region.
On the other hand, the weakness without immediate support can make 1.2375-1.2370 GBP/USD pair vulnerable to weakening more than Figure 1.2300, towards a decrease in oscillation last week, around the middle of 1.200s. Some sale must pave the way for the path to the next appropriate support near the 1.2175 area.
GBP/USD
Stering questions and answers to the pound
The British pound (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most trading of foreign unit (FX) in the world, as it represents 12 % of all transactions, with an average of 630 billion dollars a day, according to 2022 data. Their main trading pairs are GBP/USD, also known as “Cable”, Which represents 11 % of FX, GBP/JPY, or “dragon” as is known by merchants (3 %), and EUR/GBP (2 GBP (2 %). The pound sterling was released by the Bank of England (Bank of England).
The only most important factor that affects the value of the British pound is the monetary policy decided by the Bank of England. The Bank of England is based on its decisions on whether it has achieved its primary goal of “stability in prices” – a fixed inflation rate of about 2 %. Its primary performance to achieve this is to adjust interest rates. When inflation is very high, the Bank of England will try to make interest by raising interest rates, making it more expensive for people and companies to reach credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to stop their money. When inflation decreases significantly, economic growth slows down. In this scenario, the Bank of England will consider reducing interest rates to licensing credit so that companies borrow more to invest in growth generation projects.
Data affects the health of the economy and can affect the value of the pound sterling. Indicators such as gross domestic product, manufacturing, services, and employment can affect the GBP direction. The strong economy is useful for sterling. Not only attracts more foreign investments, but it may encourage the Bank of England to set interest rates, which will enhance the GBP directly. Otherwise, if the economic data is weak, it is possible that the pound sterling will fall.
Issuing another important data for the British pound is the balance of trade. This indicator measures the difference between what a country gains from its exports and what it spends on imports during a certain period. If a country produces very desirable exports, its currency will benefit from the additional demand resulting from foreign buyers who seek to buy these goods. Therefore, the positive and positive trade balance enhances the currency and vice versa to achieve a negative balance.
