GBP Daily Fundamental Analysis

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At the beginning of American session forex trading on Tuesday (3/1), British pound exchange rate is still seen trying to maintain bullish momentum gained from the release force UK PMI manufacturing data reported Markit few hours earlier in the European session. But its power began to wane by the sentiment that made the US dollar rally.

 

These sentiments come from the release of the PMI manufacturing data will be ISM or the US government reported a few hours ahead. These data are expected to show an increase in the data from the previous period and if that happens the US dollar rally that is now limited by the oil price rally is getting tight.

 

Analysts estimated that GBPUSD may fall down towards the support range between 1.2264-1.2229, and if it is not until this evening lowest range will potentially rise back towards the resistance range between 1.2306- 1.2340.

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In the midst of a moderate pace of US dollars by trying to cut he suffered weakening since the previous trading, British pound exchange rate trying to take back momentum of GBPUSD rebound which depressed since Asia session. GBPUSD rebound force in the European session comes from the release of performance data for the services sector PMI by Markit.

Markit survey of reports on the performance of private business services sector experienced the UK in December score significant leap to their highest point in 17 months. Strength from this data that makes GBPUSD pulled away from its lows at 1.2271.

Analysts estimated that GBPUSD has bigger chance to fall down towards the support range which start from 1.2260 to 1.2222, and if it is failed to reach that range then GU potentially rise back towards the range of 1.2352- 1.2390.

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In the middle of the movement of US dollar start a correction after a rebound on Asia session, just as its rivals are difficult pound continued to rally 2 consecutive days. Sentiment hard brexit reappeared and weighing on GBPUSD to rebound from profit-taking pressure on early Asia sessio.

For the sentiment which driving GBPUSD is a British local economical data which strongly driven by sentiment of US dollar. But despite the negative sentiment overshadowing US dollar, the exchange rate will not be able to rise pounds because receive bad sentiment of hard brexit.

Analysts estimated that GBPUSD has bigger chance to fall towards the range of 1.2362-1.2299 which act as the sentiment from markets, and if it is failed to reach that range there would be chance for rebound and will rise towards 1.2421- 1.2456.

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British pound exchange rate could move rebound after a strong weekend depressed on early Europe session. However, tumbled again received negative sentiment of the statement Prime Minister Theresa May to strengthen the sentiment hard brexit. Therefore trade sterling against many world currencies come under pressure.

Theresa May said it would conduct negotiations to trade some European countries after the exit from the European Union, it is expected to trigger adverse market brexit will process more quickly after the March statement when GBP exit. Market's response will have to make a pound tumbled to its lowest in 12 weeks.

For the economy as a Pound's data mover pounds on European session there Halifax data. This data is expected to increase from the previous period, but if the data is no significant increase in strength to GBPUSD rebounds. But until the evening session sentiment hard brexit will still torturing pair.

Based on that it seems that many analysts estimated that further the movement of GBPUSD will react negatively and will fall towards 1.2173-1.2161, and if there will be more positive correction will back towards 1.2194- 1.2201.

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GBPUSD rally since the beginning of Asia session to reach its highest level in five trading days but on early European session began to cut by considerations of poor market fundamentals pounds and also received negative sentiment of the speech several US officials who may clarify the FOMC monetary policy further.

GBPUSD doesn't have any economic data releases as a major driving force that is more dominantly influenced by sentiment hard brexit and also the fundamental strength of US dollar. And if the sentiment driving the pair GBPUSD disappointing dollar can rise again.

Analysts seems estimated that GBPUSD for the next trading session has bigger chance to rise back to the resistance range between 1.2322-1.2353, as for the worst scenario it will keep falling because there is no correction happened towards support range between 1.2157- 1.2110.

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On European session the pound exchange rate movements weakened against the US dollar after opening flat at around 1.2598 in early trading (0000 GMT), the exchange rate for GBPUSD is now rolling at 1.2541 pounds.

Profit taking happened after strengthening pound to seven week highs continues until the European trading session. Sentiment participating burdening rate pair is trading slump in stock markets European region.

Technically GBPUSD is still declining towards the support range between 1.2505 -1.2420, but if it does not penetrate the correction will rise to resistance range between 1.2620 to 1.2665. And analysts suggests that GBPUSD is estimated to have the support level at 1.2421 and the resistance level at 1.2697.

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The movement of sterling on the second day in February (2/2) are still confident to continue the rally after previous trading day entered the third straight. Strong support for Brexit by many members of the British parliament in voting that was taken at the meeting on February 1, became the foundation for the oncoming pounds.

 

Today, there is some momentum which can provide support for sterling strength as monetary policy announcement from the Bank of England or the Bank of England and the country's inflation report Q4-2016 period. But before there is power construction PMI are on the load rate of GBPUSD.

 

For the next trade until the close of trading ending the American session tomorrow morning, analysts estimated that GBPUSD technically can go to the resistance area. But the pace of the pair is limited by the sentiment driving the US dollar is strong enough in the American session.

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On European session , the pound exchange rate movements is pretty much negative against the US dollar after the price opened lower at 1.2508 in early trading (0000 GMT), the exchange rate is now rolling at 1.2469 pounds.

British Pound is still moving weak on European session because of the sentiment of hard brexit after a majority of MPs approved the scenario brexit lower British Prime Minister and stayed high level assembly will debate on 20 February.

Technically GBPUSD may will be corrected towards the support range between 1.2449 -1.2423, but if it is failed the price may rise towards the resistance range between 1.2533-1.2593. Analysts argued that GBPUSD pair is estimated to have the support level at 1.2411 and the resistance level at 1.2608.

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Pound exchange rate movements on Asia session moves positively against the US dollar after the price's opening higher at 1.2487 in early trading, the exchange rate is now rolling at 1.2499 pounds.

 

British Pound on Asia session trying to rebound after last week pressured by the US dollar's bullish momentum, ignoring the negative sentiment from the British government negotiations with the EU is still not solid.

 

Technically GBPUSD attempted to climb to the resistance range between 1.2514 -1.2551. In this case it seems that many analysts  argued that the normal range of GBPUSD is estimated to have the support level at 1.2354 pounds and the resistance level at 1.2586 pounds.

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Pound exchange rate movements on europe session moves positively against US Dollar after opening lower at 1.2524 in early trading (0000 GMT), the exchange rate is now rolling at 1.2534 pounds.

British Pound on European session trying to continue to rally from the previous trading because of a positive sentiment on the UK inflation rate of data that will be released a few hours ahead of data expected to show a positive alias increase from the previous month period.

Technically GBPUSD attempted to climb to the range between 1.2567-1.2603. So with the current condition it seems that many analysts estimated GBPUSD to have the support level at 1.2437 and the resistance level at 1.2583.

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Pound's effort to rebounded Wednesday (15/2) after opened at a higher position than the previous closing which dropped significantly. Weak pound movement triggered by the strong dollar bullish momentum after hawkish statements where Janet Yellen also residual negative sentiment from the inflation data release in January of England.

On Europe session yesterday, UK inflation data for January released and fell below expectations of an increase compared to previous period data. Previously, the market optimistic with the expectations of the data but after the data was released pounds which already strong, become weak once again. Likewise, during the New York session under pressure from hawkish comments Janet Yellen before the Senate Banking Congress.

For the next trade until the close of New York session tomorrow morning, analysts come to a prediction that GBPUSD views potentially weakening fundamentally, as well as the expected release of the jobless claims data and wages less steady rate which weighed on the pair.

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The bearish momentum of US Dollar become the foundation for Pound to keep rising on Asia sessio after a strong rebound in the previous trading the GBPUSD pair. This week the pair moves mixed with a potential rebound on a weekly basis after two weeks previously experienced a selling pressure.

Previously pound managed to rise high in the middle of the lack of sentiment driver of UK economic data and strong against the pressure of US economic data releases were steady from the US data release building permits and the Phily Fed Manufacturing which rose above expectations.

For the next trade until the close of trading ending the American session tomorrow morning, analysts estimated that GBPUSD seems to have chance to continue to rise if the release of retail sales data in the European session is appropriate or above expectations.

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Sterling trading against the US dollar experienced its worst loss since the trade date of January 17, 2017 with bearish positions for sixth consecutive day. Weak movement of GBPUSD this afternoon received a very strong negative sentiment after the release of the data service PMI.

 

Reported Markit data showed worse than the previous period and the expectations for a decline. Markit reported period between February and as a result the British pound under pressure so this week. With the latest pair GBPUSD position confirmed this week re-print weekly attenuation.

 

In addition to speculation sentiment Scotland out of Britain which affect this pair quite much, GBPUSD  is under pressure from global market sentiment will address US policy and budget administration by President Trump before Congress.

 

For the next trade until the close of trading ending of American session tomorrow morning, analysts estimated that GBUSD for that session may continue to rise towards the resistance range between 1.2208-1.2180.

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Sterling inched down in European trading session Monday (14 / August) afternoon, against US Dollar. GBP / USD looks stuck below the $ 1.30 level, which is the anchor level in recent months. In fact, in the previous weeks, quite a lot of news about Brexit negotiations that can be said negative.

 

The world's major banks also differed in their outlook on the pound in the rest of 2017. Some banks estimate the deeper losses Pound will experience due to the slow economy.

 

Others appear to be more optimistic, predicting that Sterling's decline in reaction to Britain's decision to pull out of the European Union is over. GBP / USD seems to decline 0.15 percent to 1.2982 earlier in the afternoon. EUR / GBP is trading at 0.9090.

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The pound rose to a daily high against the US dollar in Wednesday's trading session (16 / August) this afternoon, following the UK Employment report. The country's unemployment rate sagged to its lowest level since 1975, while its wage growth has increased.  GBP/USD touched a high level at 1.2904 sometime after the report was released. However, GBP / USD has dropped and traded at 1.2873.

 

The ONS reported the UK Unemployment rate for June dropped to 4.4 percent, lower than the 4.5 percent forecast. Average Weekly Income rose 2.1 percent (YoY) in the June quarter, better than the forecast of a 1.8 percent increase. Without taking into account bonuses, UK people's income also rose 2.1 percent, slightly better than the 2.0 percent additional forecast.

 

On the other hand, EUR / GBP declined about 0.16 percent to 0.9102. The euro weakened today, following a report that Mario Draghi of the ECB will not deliver a monetary policy change message at the Jackson Hole conference in the US.

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The pound headed for its fourth consecutive weekly decline against US dollar, the longest losing streak since January 2015, as worries about the Brexit negotiations and warm economic data weighed on the UK currency.

 

Sterling or GBP also dropped its fourth consecutive weekly drop against EURO, after touching its weakest level since October on 23 August. With Britain not clarifying how much the EU will pay as Brexit's bill, the market will carefully scrutinize next week's talks to gauge how smoothly the negotiations are.

 

GBP / USD rose slightly to 1.2813, but has declined 0.4% during the week. The currency has been on a steady decline since the week ending July 28, its longest period since the six-week decline ending on January 23, 2015

 

GBP stalled as stagnant investment and weak consumer spending figures signaled that Britain's economy was losing power. Analysts at the Commonwealth of Australia bank, including Elias Haddad, said the Bank of England was in no hurry to raise interest rates due to the economic slowdown.

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Pound Sterling reaction on the releases of UK PMI Services report for August seems flat than what people anticipated. GBP / USD in a struggle to maintain its high level, steady above the 1.29007 level this afternoon.

 

The PMI survey for the UK services sector showed the weakest growth in the past year. Concerns about Britain's exit from the European Union and the likelihood of Britain's investment plunge are the reasons for the decline of British Services PMI. The UK Services PMI index for the month of August sank to 53.2, lower than the forecast at 53.5. However, that level is still far from contraction.

 

Chris Williamson, Chief Economist Markit said, "Although in the last two months the data showed an expansion of economic growth of 0.3 percent in the third quarter, momentum is still in decline". The pound has slumped about 14 percent against US dollar since a referendum on UK exit from the European Union, and about 17 percent versus Euro. Most forex experts say that Pound Sterling is still close to its current levels amid Brexit uncertainty.

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UK inflation for August jumped to the highest level since the country decided to leave the European Union last year. The issue of Brexit apparently continues to push up the cost of living in the UK. People have to pay more for fuel and clothing. This can certainly trigger big questions on the Bank of England (BoE), why they do not go up the interest rate.

 

UK Inflation (CPI) reached 2.9 percent in August (YoY) up from 2.6 percent in the previous month, the ONS Bureau of Statistics reported Tuesday this afternoon. The data is higher than expectations of a 2.8 percent rise in UK inflation.

 

As is known, the BoE inflation target is 2.0 percent, but most central bank policy makers are still expected to keep interest rates at a low of 0.25 percent at a policy meeting on Thursday the day after. The reason, the country chairman of Prime Minister Theresa May it requires preparation to face the challenge after the official leave the European Union.

 

Following this report, GBP/USD soared to the 1.3205 level from the low 1.3160 ​​reached before the UK CPI data release. EUR / GBP drops to 0.9017 from the previous high at 0.9079. EURGBP signals a potential bearish EUR / GBP reversal. There is a possibility the price will plunge to touch the range around 0.8950.

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Sterling jumped through 1.3500 per US dollar for the first time in 14 months, on Friday (15 / Sep) this afternoon. The reason is a statement from one of the Bank of England (BoE) officials who said it could raise interest rates next month.

 

GBP / USD, which has gained about half a percent on the Asian session earlier, added its rise to a 14-month high around 1.3585. A rise of more than 1 percent came after Vlieghe made his comments. Not only against US Dollar, Pound Sterling also getting stronger against Euro with a decline of EUR / GBP as much as 0.9 percent to 0.8870.

 

Vlighe's statement was quite clear. The reason yesterday, Mark Carney BoE also implies a fairly hawkish statement after announcing monetary policy, but still on condition. If the rise in inflation continues, then the stimulus withdrawal policy may be possible in the next few months.

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September inflation jumped to its highest level in five years. Official data reported on Tuesday this afternoon is expected to strengthen the reason for the Bank of England (BoE) to raise interest rates next month.

 

The ONS Bureau of Statistics reported that the UK Consumer Price Index (CPI) - a key parameter of inflation gauge - reached 3 percent in September (YoY), up from 2.9 percent in the previous month. The number achieved again the first time since April 2012, as well as in accordance with expectations.

 

The rise in inflation - caused largely by the declining Pound exchange rate since the announcement of the Brexit referendum result in 2016 - has sparked revenues this year. UK economic growth slows as employee salaries fail to accelerate as cost of living increases.

 

The majority of Reuters economists predict that the BoE will take action at its November meeting ahead, because if the monetary policy changes are made this month, then it is feared would be a wrong decision.

 

Following the UK inflation report, GBP / USD rose in moderate volume and traded around 1.3257 although the candle needle pierced level 1.3287 shortly after the report was released. EUR / GBP decreased about 0.33 percent to 0.8872.

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UK Retail Sales for September was unexpectedly slowing over the previous month. This is allegedly a result of the high rise in UK inflation that strangled the purchasing power of consumers

 

On Thursday this afternoon, the ONS reported that Retail Sales in the UK only rose about 1.2% in September, from the same month in 2016 (YoY). Very far back compared with last August, ie from 2.3 percent. Though expectations will stagnate at the same level of growth as August.

 

In the MoM base, UK Retail Sales slumped by as much as 0.8 percent. Sales of goods in the department store suffered the most severe pressure, followed by food sales. Viewed overall in the third quarter (QoQ), Retail Sales increased 1.5 percent from the same period in 2016.

 

Following the report, the pound stumbled to a daily low, with GBP / USD trading at 1.3157 this afternoon, down 0.42 percent from the previous figure. While EUR / GBP rose as much as 0.53 percent to 0.8973 from 0.8940.

 

The rise in UK inflation was more due to the weakening of Pound post Brexit last year. Unfortunately, the rise in inflation is not accompanied by an increase in salaries, so that people experience a decline in purchasing power and lead to weakening Retail Sales.

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Sterling rallied on Monday after posting its biggest weekly gain in more than a month as investors raised concerns about the outcome of the Brexit talks next month in connection with the political crisis in Ireland.

 

The deal on the Northern Ireland border which means a key demand by EU policymakers has suddenly become more complicated because the Dublin government appears to be falling. Irish Prime Minister Leo Varadkar, who has warned of a veto without Britain on the border issue, and is likely to hold an accelerated election next week, has also become a new issue in the market.

 

After that, Sterling seems to hit a two-month high at $ 1.3360 on Friday and was on track to post its first monthly rise in three months. As on Monday, the price of flats against US Dollar at $ 1.3344. The flat sterling exchange rate against the Japanese yen was at 148.57 yen.

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British banks can overcome the "chaos" caused by Brexit without the need to cut borrowing or bailout by taxpayers, the UK Central Bank (BoE) said Tuesday this afternoon, in the announcement of the annual UK healthcare check .

 

For the first time since the BoE began to "stress-testing" commercial banks in 2014, no major banks have to raise extra capital despite Brexit causing uncertainty, the BoE said.

 

Barclays and Royal Bank of Scotland (RBS) are considered unsuccessful in undergoing financial health checks by the central bank, however, the two giant banks are also not up to raise the extra capital because they have increased capital in a year.

 

Reports from the financial sector from the BoE this afternoon made Pound volatility sharply moving. GBP / USD dropped to the level of 1.3302, after the candle pair needle had penetrated the high level 1.3357 this afternoon.

 

In addition, there are also reports that report on new issues in the Brexit negotiations. The Irish government has reportedly threatened to issue a veto on the Brexit negotiations, on border issues with Britain, which include priority issues discussed by negotiators.

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Facing a crisis related to the proposals of the Brexit Act and the ongoing cabinet work facing challenges in Parliament, Prime Minister Theresa May is rumored to be conducting a massive reshuffle in Britain's top politicians this week. In this reshuffle, not only the presumed Conservative Party leader will be replaced.

Prime Minister May's cabinet has faced some turmoil in the past two months. In November 2017, he was threatened by a no-confidence vote proposed by a number of members of Parliament; and the chaos that was triggered by representatives of the people who came from members of his own party, the Conservative Party, but against Brexit.

For now, it is not yet known how reshuffle efforts will affect the Brexit-related negotiations. After the news breaks out, the GBPUSD currency pair is still in the range around 1.3545, while EUR/GBP remains up and down but still above 0.8850. Most likely, these rumors will affect Poundsterling in the New York session as well.