Published on Apr 18, 2023

Daily Analysis For GBP/USD 18-04-2023

GBP/USD Analysis

Economic Events and Scenario for GBP/USD

Economic Events: -

GMT	Event	Impact	Currency
01:00	(Cyprus) Orthodox Easter Tuesday	None	EUR
02:30	(Australia) RBA Meeting Minutes	High	AUD
03:00	(China) Industrial Capacity Utilization	Low	CNY
03:00	(China) Retail Sales YoY	High	CNY
03:00	(China) Industrial Production YoY	High	CNY
03:00	(China) Fixed Asset Investment (YTD) YoY	Medium	CNY
03:00	(China) GDP Growth Rate YoY	High	CNY
03:00	(China) GDP Growth Rate QoQ	Medium	CNY
03:00	(China) Unemployment Rate	High	CNY
07:00	(United Kingdom) Average Earnings excl. Bonus (3Mo/Yr)	Low	GBP
07:00	(United Kingdom) Average Earnings incl. Bonus (3Mo/Yr)	Medium	GBP
07:00	(United Kingdom) Unemployment Rate	High	GBP
07:00	(United Kingdom) Claimant Count Change	High	GBP
07:00	(United Kingdom) Employment Change	High	GBP
07:00	(United Kingdom) HMRC Payrolls Change	Low	GBP
09:00	(Italy) Balance of Trade	Medium	EUR
09:40	(Spain) 3-Month Letras Auction	Low	EUR
10:00	(China) FDI (YTD) YoY	Medium	CNY
10:00	(Euro Area) ZEW Economic Sentiment Index	Medium	EUR
10:00	(Euro Area) Balance of Trade	Medium	EUR
10:00	(Germany) ZEW Current Conditions	Low	EUR
10:00	(Germany) ZEW Economic Sentiment Index	High	EUR
10:00	(United Kingdom) 30-Year Treasury Gilt Auction	Low	GBP
11:00	(Ireland) Balance of Trade	Low	EUR
13:30	(Canada) New Motor Vehicle Sales	Low	CAD
13:30	(Canada) Inflation Rate MoM	Medium	CAD
13:30	(Canada) Core Inflation Rate YoY	Medium	CAD
13:30	(Canada) Inflation Rate YoY	High	CAD
13:30	(Canada) Core Inflation Rate MoM	Low	CAD
13:30	(Canada) CPI Median YoY	High	CAD
13:30	(Canada) CPI Trimmed-Mean YoY	High	CAD
13:30	(United States) Housing Starts	Medium	USD
13:30	(United States) Building Permits	High	USD
13:30	(United States) Housing Starts MoM	Medium	USD
13:30	(United States) Building Permits MoM	Medium	USD
13:55	(United States) Redbook YoY	Low	USD
14:00	(Ecuador) Balance of Trade	Low	USD
14:00	(Euro Area) ECB Elderson Speech	Low	EUR
16:00	(New Zealand) Global Dairy Trade Price Index	Low	NZD
16:30	(United States) 52-Week Bill Auction	Low	USD
18:00	(United States) Fed Bowman Speech	Medium	USD
21:30	(United States) API Crude Oil Stock Change	Medium	USD

Today's Scenario: - The GBP/USD currency pair is hovering around 1.2380 in the early Tuesday trading session, breaking the two-day downward trend before the significant UK jobs report. However, despite the pause, the bears remain optimistic, as the Federal Reserve's hawkish stance contrasts with the anticipated weak job figures from the UK.

On Monday, the US Dollar Index (DXY) continued its rally from a one-year low, supported by positive US data and hawkish statements from the Fed. The increasing likelihood of another Fed rate hike in May, coupled with reduced market expectations of a rate cut in late 2023, further boosted the index. US Treasury bond yields also experienced an uptrend, with the 10-year and two-year bond coupons printing a three-day rise to 3.60% and 4.20%, respectively.

Buy Scenario: - If the GBP/USD pair manages to recover and surpass the high on April 13 at 1.2537, it could rise towards a fresh 10-month high at 1.2597, which was last reached on June 08, 2022. Breaking this level would expose the pair to the high on May 27 at 1.2667. Till we do not advise to buy GBP/USD.

Sell Scenario: - The GBP/USD currency pair has entered a bearish trend, as indicated by the breakdown of the Ascending Triangle chart pattern on the two-hour scale. The trendline, which slopes upwards, is plotted from the low on March 24 at 1.2191, while the horizontal resistance is placed at the high on April 04 at 1.2525.

The Pound Sterling bulls face resistance from the 20-period Exponential Moving Average (EMA) at 1.2404.

The Relative Strength Index (RSI) (14) is currently oscillating in the bearish range of 20.00-40.000, indicating that the momentum is currently downwards.

If the GBP/USD pair falls below the low on April 10 at 1.2345, the next support level is at the low on March 30 at 1.2294, followed by the low on March 27 at 1.2219. Till then we do not advise selling GBP/USD.

Support and Resistance Level: -