We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Bullish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The price of #gold may continue to exhibit a bullish behavior in June as the pullback from the yearly high ($1765) reverses ahead of the May low ($1670). Get your Gold market update from @DavidJSong here: https://t.co/OeaYtCpcIo https://t.co/UQVPIVCTCP
  • The $USD breakdown has taken the index into confluence support at the objective yearly open. Get your USD technical analysis from @MBForex here: https://t.co/A16XEv6n4d https://t.co/GzEp3gCAe5
  • US equities continue to run higher with the Nasdaq 100 setting a fresh all-time-high, not even three months after giving back almost a third of its value in about a month. Get your #Nasdaq technical analysis from @JStanleyFX here: https://t.co/1LI54uvI8x https://t.co/e9FvSLqfaA
  • The US Dollar may be at risk to losses against some of its #ASEAN counterparts. USD/SGD, USD/PHP, USD/MYR and USD/IDR have recently broken to the downside. Will losses continue? Find out from @ddubrovskyFX here: https://t.co/0RTlj6maTT https://t.co/UyQ4i0AihI
  • The British Pound technical outlook still seems to favor the downside. GBP/CAD may pressure key rising support from August as GBP/AUD could prolong its downtrend. GBP/CHF may fall. Get your $GBP market update from @ddubrovskyFX here: https://t.co/hBOpDKXmfW https://t.co/AJlT2YKeCu
  • USD/JPY is approaching medium-term uptrend resistance and while the outlook remains constructive, the advance may be vulnerable near-term while below confluence resistance. Get your $USDJPY technical analysis from @MBForex here: https://t.co/93D7AyhHtG https://t.co/KQcLLrkMP3
  • AUD/USD has had the most impressive show of trend over the past couple of months with the pair gaining almost 1500 pips from the March low. Get your $AUDUSD technical analysis from @JStanleyFX here: https://t.co/vLz4Rpln3u https://t.co/AOwnJja5V8
  • Has the #Euro been saved? Find out from @CVecchioFX here: https://t.co/eiXfOTyGa6 https://t.co/AyRiYpb4cN
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/ygwjGNvS61
  • The $USD, Euro, British Pound and Australian Dollar will all be at the mercy of political developments in Asia, Europe and North America this week. An avalanche of PMI data will set the backdrop. Find out from @ZabelinDimitri here: https://t.co/L8cfAgVx94 https://t.co/THWhPAS6AM
British Pound Positioned to Advance, Just Not Against Safe Havens

British Pound Positioned to Advance, Just Not Against Safe Havens

2012-05-05 00:03:00
Christopher Vecchio, CFA, Senior Strategist
Share:
British_Pound_Positioned_to_Advance_Just_Not_Against_Safe_Havens_body_Picture_5.png, British Pound Positioned to Advance, Just Not Against Safe HavensBritish_Pound_Positioned_to_Advance_Just_Not_Against_Safe_Havens_body_Picture_6.png, British Pound Positioned to Advance, Just Not Against Safe Havens

Fundamental Forecast for British Pound: Bullish

The British Pound had an interesting week, as it was the third best performer, outpacing the commodity currencies and the European currencies. While the Sterling gained 0.60 percent against the Euro, it rallied by 2.12 percent and 2.67 percent against the Australian and New Zealand Dollars, respectively, the past five days. However, all was not sanguine the first week of May: the Japanese Yen and the US Dollar gained 1.24 percent and 0.71 percent, respectively, against the Pound. The price action towards the end of the week was key, and in light of that alongside the fundamental developments expected in the coming days, hold a neutral forecast for the Pound, as we anticipate it rallying against the commodity currencies and the European currencies while depreciating against the US Dollar and the Yen, just as it did this week.

Taking a look at data due this week, Thursday is far-and-away the most important day on the docket for the British Pound. Ahead of the Bank of England policy meeting at 11:00 GMT, industrial and manufacturing production figures for March are due, and both are expected to be disappointing. In terms of the latter, industrial production is expected to contract on both a monthly- and a yearly-basis, with a Bloomberg News survey forecasting prints of -0.3 percent and -2.6 percent, respectively. Overall, this would represent a steeper contraction than that in February, when industrial production fell by 2.3 percent y/y. In terms of the former, manufacturing production is expected to increase to 0.5 percent from -1.0 percent m/m, but production remains down with the forecast showing -1.3 percent y/y.

The big news for the British Pound comes later on the day on Thursday, when the BoE meets for their monthly meeting. Although the first quarter GDP reading was ultimately a disappointment, rising inflationary pressures have handicapped monetary officials who are trying to stoke growth in an environment of austerity. As such, while there won’t be a policy statement accompanying the meeting, we expect Monetary Policy Committee to holds its recently more hawkish bias.

Accordingly, the main reason the British Pound is set to continue to appreciate has to do with the increasingly dovish monetary policies being implemented or threatened by many of the world’s major central banks simultaneously. Whereas the Bank of England has started to lean hawkish: the Reserve Bank of Australia cut their interest rate by 50.0-basis points on Tuesday; the Reserve Bank of New Zealand noted in their policy statement last Thursday that it could shift its monetary policy if the New Zealand Dollar remains elevated; and the European Central Bank is coming under increasing pressure to intervene in the secondary bond markets more to help support periphery debt, mainly that of Italy and Spain. In light of these strong fundamental trends – indeed, stronger than a weak GDP print– the British Pound is relatively bullish in the periods ahead, but we caution that it is likely to fall against the Japanese Yen and US Dollar further if concerns over the Euro-zone remain especially elevated, as they have in recent days. - CV

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.