News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Bearish
Wall Street
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
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • Use this technical analysis pattern recognition skills test to sharpen your knowledge: https://t.co/Qgz89PTxnu https://t.co/ucc7bSbPhj
  • IG Client Sentiment Update: Our data shows the vast majority of traders in EUR/CHF are long at 74.41%, while traders in France 40 are at opposite extremes with 79.74%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/qBNern9KzG
  • Forex Update: As of 04:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.19% 🇨🇦CAD: 0.06% 🇪🇺EUR: 0.04% 🇬🇧GBP: 0.01% 🇦🇺AUD: -0.01% 🇯🇵JPY: -0.01% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/sstttLinxA
  • Heads Up:🇯🇵 Tertiary Industry Index MoM (APR) due at 04:30 GMT (15min) Previous: 1.1% https://www.dailyfx.com/economic-calendar#2021-06-15
  • Indices Update: As of 04:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.38% France 40: 0.31% FTSE 100: 0.30% US 500: 0.14% Wall Street: 0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/JRrEqhpvhq
  • (Commodities Brief) Gold Price Outlook: XAU/USD Top in Play as 10-Year Treasury Yield Rebounds? #Gold #XAUUSD #Fed #Bonds https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2021/06/15/Gold-Price-Outlook-XAUUSD-Top-in-Play-as-10-Year-Treasury-Yield-Rebounds.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/PZz6d4GCxt
  • Heads Up:🇮🇩 Balance of Trade (MAY) due at 04:00 GMT (15min) Expected: $2.3B Previous: $2.19B https://www.dailyfx.com/economic-calendar#2021-06-15
  • Get your snapshot update of the of market open and closing times for each major trading hub around the globe here: https://t.co/BgZLFljIhZ https://t.co/dObQjwTEpH
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here: https://t.co/yOEvLjKnct https://t.co/K8PLT8SVEb
  • We are within 48 hours of the FOMC rate decision and markets are clearly paying attention. The Dow is struggling while the SPX has edged a fresh record. Meanwhile, the Dollar is a deer in the headlines. I discuss what to expect for Tuesday trade: https://www.dailyfx.com/forex/video/daily_news_report/2021/06/15/Dow-and-SP-500-Diverge-Ahead-of-FOMC-Dollar-Holds-as-Gold-and-Yields-Slide.html https://t.co/J0H5HirVh0
GBP/USD Forecast: Post-EU Summit Weakness to Persist as Bull Trend Snaps

GBP/USD Forecast: Post-EU Summit Weakness to Persist as Bull Trend Snaps

David Song, Strategist

British Pound Talking Points

GBP/USD is back under pressure even as U.K. Prime Minster Theresa May argues that the Brexit negotiations are ‘95%’ complete, and recent price action raises the risk for a further decline in the exchange rate as it carves a series of lower highs.

Image of daily change for major currencies

GBP/USD Forecast: Post-EU Summit Weakness to Persist as Bull Trend Snaps

Image of daily change for gbpusd rate

GBP/USD stands at risk for further losses as the European Union (EU) Summit fails to boost the appeal of the British Pound, and the lackluster reaction suggests the uncertainty surrounding Brexit will continue to drag on the exchange rate especially as the Bank of England (BoE) looks poised to keep the benchmark interest rate on hold at its next quarterly meeting on November 1.

Image of boe bank rate

Recent comments from BoE Governor Mark Carney suggest the central bank is in no rush to implement higher borrowing-costs as the Monetary Policy Committee (MPC) is ‘preparing for the worst’ possible Brexit scenario, and the central bank may largely endorse a wait-and-see approach for the remainder of the year as the U.K. is currently scheduled to depart from the EU on March 29.

With that said, the BoE may resume its hiking-cycle in 2019 as the MPC warns that ‘an ongoing tightening of monetary policy over the forecast period would be appropriate to return inflation sustainably to the 2% target at a conventional horizon,’ but the current environment may keep GBP/USD under pressure as the IG Client Sentiment Report continues to reflect a skew in retail interest.

Image of IG client sentiment for gbpusd

The fresh updates show 67.9% of traders are net-long GBP/USD, with the ratio of traders long to short now at 2.12 to 1.In fact, traders have remained net-long since September 20 when GBP/USD traded near the 1.3150 region even though price has moved 0.7% lower since then. At the same time, the percentage of traders net-long is now its highest since September 7 when pound-dollar traded near the 1.2910 area. The number of traders net-long is 1.9% higher than yesterday and 12.9% higher from last week, while the number of traders net-short is 34.8% lower than yesterday and 29.9% lower from last week.

The recent pickup in net-short position has quickly fizzled as GBP/USD gives back the advance from earlier this month, and the rise in net-long position suggests traders are attempting to fade the weakness in GBP/USD, with a further shift in retail interest offering a contrarian view to crowd sentiment.

In turn, downside targets are back on the radar for GBP/USD following the string of failed attempts to test the September-high (1.3299), with the exchange rate at risk of exhibiting a more bearish behavior as it snaps the upward trend from the 2018-low (1.2662). Keep in mind, the Relative Strength Index (RSI) highlights similar dynamic as the oscillator fails to retain a similar formation, with the developments raising the risk for further losses especially as the bearish momentum appears to be gathering pace. Sign up and join DailyFX Currency Analyst David Song LIVE for an opportunity to discuss potential trade setups!

GBP/USD Daily Chart

Image of gbpusd daily chart
  • The failed attempt to test the 1.3310 (100% expansion) to 1.3370 (78.6% expansion) hurdle brings the downside targets back on the radar as GBP/USD extends the series of lower highs from the previous week.
  • In turn, a break/close below the 1.2890 (50% expansion) to 1.2950 (23.6% expansion) region raises the risk for a move back towards the 1.2800 (50% expansion) handle, with the next area of interest coming in around 1.2630 (38.2% expansion) to 1.2640 (23.6% retracement), which sits just beneath the 2018-low (1.2662).

For more in-depth analysis, check out the Q4 Forecast for the British Pound

Additional Trading Resources

Are you looking to improve your trading approach? Review the ‘Traits of a Successful Trader’ series on how to effectively use leverage along with other best practices that any trader can follow.

Want to know what other currency pairs the DailyFX team is watching? Download and review the Top Trading Opportunities for 2018.

--- Written by David Song, Currency Analyst

Follow me on Twitter at @DavidJSong.

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

DISCLOSURES