Published on Apr 25, 2023

Daily Analysis For GBP/USD 25-04-2023

GBP/USD Analysis

Economic Events and Scenario for GBP/USD

Economic Events: -

GMT	Event	Impact	Currency
01:00	(Australia) ANZAC Day	None	AUD
01:00	(Italy) Liberation Day	None	EUR
01:00	(New Zealand) ANZAC Day	None	NZD
01:00	(Portugal) Liberty Day	None	EUR
03:45	(East Timor) Inflation Rate MoM	Low	USD
03:45	(East Timor) Inflation Rate YoY	Low	USD
07:00	(Switzerland) Balance of Trade	Medium	CHF
07:00	(United Kingdom) Public Sector Net Borrowing	Low	GBP
07:00	(United Kingdom) Public Sector Net Borrowing Ex Banks	Low	GBP
08:00	(Spain) PPI YoY	Low	EUR
09:00	(Euro Area) ECB Enria Speech	Low	EUR
09:30	(Slovenia) Tourist Arrivals YoY	Low	EUR
10:00	(United Kingdom) BoE Member Broadbent	Low	GBP
10:30	(Germany) 2-Year Schatz Auction	Low	EUR
11:00	(Latvia) PPI MoM	Low	EUR
11:00	(Latvia) PPI YoY	Low	EUR
11:00	(Luxembourg) Balance of Trade	Low	EUR
11:00	(United Kingdom) CBI Industrial Trends Orders	Medium	GBP
11:00	(United Kingdom) CBI Business Optimism Index	Medium	GBP
13:00	(United States) Building Permits	Medium	USD
13:00	(United States) Building Permits MoM	Low	USD
13:55	(United States) Redbook YoY	Low	USD
14:00	(United States) House Price Index	Low	USD
14:00	(United States) House Price Index YoY	Low	USD
14:00	(United States) House Price Index MoM	Low	USD
14:00	(United States) S&P/Case-Shiller Home Price MoM	Medium	USD
14:00	(United States) S&P/Case-Shiller Home Price YoY	Medium	USD
15:00	(United States) Richmond Fed Manufacturing Shipments Index	Low	USD
15:00	(United States) CB Consumer Confidence	Medium	USD
15:00	(United States) Richmond Fed Services Index	Low	USD
15:00	(United States) Richmond Fed Manufacturing Index	Low	USD
15:00	(United States) New Home Sales	High	USD
15:00	(United States) New Home Sales MoM	High	USD
15:30	(United States) Dallas Fed Services Revenues Index	Low	USD
15:30	(United States) Dallas Fed Services Index	Low	USD
15:30	(United States) NY Fed Treasury Purchases 4.5 to 7 yrs	Low	USD
18:00	(United States) 2-Year Note Auction	Low	USD
21:30	(United States) API Crude Oil Stock Change	Medium	USD
23:45	(New Zealand) Imports	Low	NZD
23:45	(New Zealand) Exports	Low	NZD
23:45	(New Zealand) Balance of Trade	Medium	NZD

Today's Scenario: - During the Asian session, the GBP/USD pair managed to surpass the psychological resistance level of 1.2500. This impressive move upwards is largely due to the weakening of the US Dollar Index (DXY). The DXY reached its weekly low at 101.20, and further downside is expected as investors predict that the Federal Reserve (Fed) will wrap up its quantitative tightening program following a 25 basis point interest rate hike in May.

As a result, the Cable has shown strong bullish momentum, taking advantage of the current weakness in the US Dollar Index.

Buy Scenario: - The GBP/USD pair seems poised to continue its recent upward trend towards the previous support line from March 15, located around 1.2540. However, the channel's top line, which is currently near 1.2560, could pose a challenge for buyers.

It is worth noting that the Relative Strength Index (RSI) is approaching overbought levels, which may make it difficult for the GBP/USD pair to surpass 1.2560.

If the quote manages to break through 1.2560, the focus will shift to the 1.2600 round figure and the May 2022 peak of around 1.2665. Till we do not advise to buy GBP/USD.

Sell Scenario: - On the downside, a convergence of the previous resistance line from one week ago and an upward-sloping trend line from Friday, located close to 1.2440, is expected to provide support for the GBP/USD pair.

If this level fails to hold, the channel's bottom line and the 200-SMA, respectively near 1.2370 and 1.2325, may challenge the Cable bears before giving them control.

However, the monthly bottom at around 1.2275 could act as an additional support level to the downside. Till then we do not advise selling GBP/USD.

Support and Resistance Level: -