Daily Analysis For GBP/USD  10-05-2023

Daily Analysis For GBP/USD 10-05-2023

GBP/USD Analysis
GBP/USD
Economic Events and Scenario for GBP/USD
Economic Events: -
GMTEventImpactCurrency
00:50(Japan) Foreign Exchange ReservesLowJPY
01:00(El Salvador) Mothers' DayNoneUSD
05:30(Netherlands) Manufacturing Production MoMLowEUR
06:00(Estonia) Balance of TradeLowEUR
06:00(Finland) Industrial Production YoYLowEUR
06:00(Japan) Coincident IndexLowJPY
06:00(Japan) Leading Economic IndexLowJPY
07:00(Germany) Harmonised Inflation Rate YoYLowEUR
07:00(Germany) Harmonised Inflation Rate MoMLowEUR
07:00(Germany) Inflation Rate MoMMediumEUR
07:00(Germany) Inflation Rate YoYMediumEUR
07:00(Germany) CPIHighEUR
07:00(Lithuania) Balance of TradeLowEUR
08:00(Austria) Industrial Production YoYLowEUR
08:00(Slovakia) Industrial Production YoYLowEUR
09:00(Italy) Industrial Production YoYLowEUR
09:00(Italy) Industrial Production MoMMediumEUR
09:30(Slovenia) Industrial Production YoYLowEUR
10:00(Belgium) Industrial Production MoMLowEUR
10:00(Belgium) Industrial Production YoYLowEUR
10:00(Cyprus) Balance of TradeLowEUR
10:00(Greece) Harmonised Inflation Rate YoYLowEUR
10:00(Greece) Inflation Rate YoYLowEUR
10:00(Greece) Inflation Rate MoMLowEUR
10:00(Greece) Industrial Production YoYLowEUR
10:00(Malta) Balance of TradeLowEUR
10:00(United Kingdom) 10-Year Treasury Gilt AuctionLowGBP
10:10(Italy) 12-Month BOT AuctionLowEUR
10:30(Germany) 30-Year Bund AuctionLowEUR
11:00(Spain) Consumer ConfidenceMediumEUR
11:00(Latvia) Balance of TradeLowEUR
11:00(Portugal) Balance of TradeLowEUR
11:00(Portugal) Unemployment RateLowEUR
12:00(United States) MBA 30-Year Mortgage RateMediumUSD
12:00(United States) MBA Mortgage ApplicationsLowUSD
12:00(United States) MBA Mortgage Refinance IndexLowUSD
12:00(United States) MBA Mortgage Market IndexLowUSD
12:00(United States) MBA Purchase IndexLowUSD
13:30(Canada) Building Permits MoMLowCAD
13:30(United States) Inflation Rate MoMMediumUSD
13:30(United States) Core Inflation Rate MoMMediumUSD
13:30(United States) Inflation Rate YoYHighUSD
13:30(United States) Core Inflation Rate YoYHighUSD
13:30(United States) CPIHighUSD
13:30(United States) CPI s.aHighUSD
15:30(United States) EIA Refinery Crude Runs ChangeLowUSD
15:30(United States) EIA Crude Oil Stocks ChangeMediumUSD
15:30(United States) EIA Distillate Stocks ChangeLowUSD
15:30(United States) EIA Heating Oil Stocks ChangeLowUSD
15:30(United States) EIA Gasoline Production ChangeLowUSD
15:30(United States) EIA Crude Oil Imports ChangeLowUSD
15:30(United States) EIA Gasoline Stocks ChangeMediumUSD
15:30(United States) EIA Cushing Crude Oil Stocks ChangeLowUSD
15:30(United States) EIA Distillate Fuel Production ChangeLowUSD
16:30(United States) 17-Week Bill AuctionLowUSD
17:00(Canada) 2-Year Bond AuctionLowCAD
18:00(United States) 10-Year Note AuctionLowUSD
19:00(United States) Monthly Budget StatementMediumUSD
23:45(New Zealand) Food Inflation YoYLowNZD

Today's Scenario: - In the early Tokyo session, the GBP/USD pair is showing signs of a recovery and is aiming to surpass the immediate resistance level of 1.2630. This upward momentum is partly due to the uncertainty surrounding the US debt ceiling talks, which ended without any conclusion.
US President Joe Biden has mentioned that House Speaker Kevin McCarthy was not prepared to take the default option off the table. Further discussions are set to take place on Friday, which will bring US inflation back into the spotlight. The US Dollar Index (DXY) has continued its recovery, reaching a level near 101.65, as market participants expect US inflation to remain high.

Buy Scenario: - The GBP/USD currency pair has rebounded after testing the breakout region near 1.2600 of the Rising Channel chart pattern on a two-hour scale. This successful test of the Rising Channel breakout has instilled confidence in the strength of the breakout.
The 50-period Exponential Moving Average (EMA) at 1.2600 is providing support for the Pound Sterling bulls.
Meanwhile, the Relative Strength Index (RSI) (14) has corrected and is now in the 40.00-60.00 range. An upward break into the 60.00-80.00 range would indicate bullish momentum.
Further recovery above the May 9 high at 1.2640 will push the currency pair towards the round-level resistance at 1.2700, followed by the April 26, 2022 high at 1.2772. Till we do not advise to buy GBP/USD.

Sell Scenario: - GBP/USD sellers manage to break through the immediate resistance-turned-support at around 1.2580, they will face a challenge from the convergence of an upward-sloping trend line from April 21 and the 21-day moving average (DMA) near 1.2500 before they can take control of the pair.
And also a reversal move below the May 5 low at 1.2561 will push the Cable towards the April 26 high at 1.2515, followed by the May 2 low at 1.2436. Till then we do not advise selling GBP/USD.

Support and Resistance Level: -
SupportResistance
S1 1.2586-R1 1.2648
S2 1.2551-R2 1.2675
S3 1.2525-R3 1.2709

Discussion

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