GBP/USD Rises As UK GDP Stagnates, Powell Up Next
Fiona Cincotta February 11, 2020 12:02 PM
Yet the disappointing hard data prints could change over the coming months, as we have seen in recent survey’s, optimism has improved considerably following December’s general election. The big question is whether the improved soft data will filter down into stronger hard data? The BoE thinks it will, slowly, with 0.2% growth forecast for Q1 and 0.3% growth forecast for Q2.
The BoE will not be tempted to cut rates on today’s prints instead the wait and see approach remains fitting, helping to lift the pound marginally.
Attention will now turn to Fed Chair Jerome Powell who is due to testify before Congress today and tomorrow. His testimony comes at a key junction for the US economy as is leaves behind a bruising trade dispute with China, as the Fed battles low inflation but a sold labor market.
Jerome Powell will hope to give his views on the economy and hint towards the path of monetary policy without tying himself or the Fed down. We expect is to be an overall upbeat testimony with a nod towards the threat of coronavirus to the global economy.
Level to watch:
Despite jumping 0.1% higher GBOP/USD continues to trade firmly below its 50, 100 and 200 sma on the 4 hour chart with bearish momentum.
GBP/USD met resistance at yesterday’s high of $1.2948. A move above here could open the door back to $1.30 (high 6th Feb, round number & 50 sma) a level which could negate the current bearish trend.
Immediate support can be seen at yesterday’s and today’s low of $1.2895. A break through here could open the door to $1.2870 the low on (10th Feb).
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.