Possible future paths for GBP/USD
This pair has reached an interesting point on the daily charts. There are a number of possible scenarios from the technical point of view, and it's very possible the data in the coming hours and days will help realize one of them.
Construction PMI for the GBP comes in little more than an hour. It's expected to come a little lower than last month, and could have a dampening effect on the climb rate of the pair should it come even lower, although possibly will have no long term effects unless it comes very much lower than expected. It is, after all, an indicator of the economy's health.
Beware of employment data from the US later this week, as this could have a stronger effect on any USD pairs.
Next week the official bank rate is published. This is a major event that will determine the long term future of the cable. Will they maintain the current rate as expected? Will they become even more hawkish on the UK economy? Or will they soften their tone? My guess is they will keep it as expected. GBP data has been good, but not spectacular, so perhaps we will see a continuation of the current channel. But who dares predict so far into the future?
After a couple of days it will be made clear which technical path GBP/USD is going to take.
Construction PMI for the GBP comes in little more than an hour. It's expected to come a little lower than last month, and could have a dampening effect on the climb rate of the pair should it come even lower, although possibly will have no long term effects unless it comes very much lower than expected. It is, after all, an indicator of the economy's health.
Beware of employment data from the US later this week, as this could have a stronger effect on any USD pairs.
Next week the official bank rate is published. This is a major event that will determine the long term future of the cable. Will they maintain the current rate as expected? Will they become even more hawkish on the UK economy? Or will they soften their tone? My guess is they will keep it as expected. GBP data has been good, but not spectacular, so perhaps we will see a continuation of the current channel. But who dares predict so far into the future?
After a couple of days it will be made clear which technical path GBP/USD is going to take.
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