Analysis and Recommendations (GBP/USD Analysis Forecast 21 May):
The GBP/USD dipped 8 points after the release of Bank of England MPC minutes and the stronger US dollar. The pound is trading at 1.5506 after the lackluster inflation print on Tuesday. Minutes from May’s Bank of England policy meeting were in focus in European trading hours. Last week’s quarterly Inflation Report revealed that the central bank is assuming its first post-crisis interest rate hike will occur around mid-2016. That is significantly later than what is being implied by priced-in market expectations. Indeed, futures market pricing implies lift-off in the first quarter of next year. If the Minutes document shines light on this disparity, investors may well have to adjusted expectations outward, sending the GBP lower.
The spotlight shifts to minutes from April’s FOMC sit-down. Janet Yellen and company have argued that weakness seen through the winter is transitory. Indeed, there seem to be striking parallels between the first-quarter slumps in 2014 and 2015. Last year, the markets bet on a slowdown or pause of the QE “taper” after the winter downturn only to be met with steadfast resolve on from the FOMC. A parallel result this time would imply a rate hike around mid-year, not late in the fourth quarter as is now predicted.
GBPUSD has fallen as EUR/USD for two days. This fall has been valued as a reaction of sellers for the up trend to realize profits until the bottom level of the trend cahnnel which is 1.5450 – 1.5390. After this fall, GBP/USD stayed over this level and had a small rise. This level is so critical that, traders should watch the movements around 1.5450.
First we have to get if bearish reactions are over…
To answer that question we got to analyse to areas. First one is the bottom level of short term up trend which is 1.5450. To continue the up trend, GBP/USD should not break this level below. The second one is, GBP/USD has to get over 1.5555 than 1.5630 barrier to continue the trend. As long as this two issues are solved, BULLS will take over the market. arz etmektedir.
So 1.5450 – 1.5555 – 1.5630 levels should be watched carefully.
GBP/USD Support And Resistance Levels For 21 May 2015
Pivot : 1.5555
Support : 1.5450-1.5390-1.5305
Resistance : 1.5555-1.5630-1.5705
ForexTraq provides in-depth analysis for each currency and commodity we review in forex trading. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information for GBP/USD in our weekly reports.
Today’s economic releases actual vs. forecast:
|AUD||RBA Assist Gov Lowe Speaks|
|JPY||GDP (YoY) (Q1)||2.4%||1.5%||1.1%|
|JPY||GDP (QoQ) (Q1)||0.6%||0.4%||0.3%|
|AUD||Westpac Consumer Sentiment (May)||6.4%||-3.2%|
|EUR||German PPI (MoM) (Apr)||0.1%||0.2%||0.1%|
|GBP||BoE MPC vote cut (May)||0||0||0|
|GBP||BoE MPC vote hike (May)||0||0||0|
|GBP||BoE MPC vote unchanged (May)||9||9||9|
|GBP||BoE MPC Meeting Minutes|
Upcoming Economic Events that you should be monitoring for GBP/USD in forex trading:
Thursday, May 21, 2015
|CNY||HSBC Manufacturing PMI||49.3||48.9|
|EUR||German Manufacturing PMI||52.3||52.1|
|GBP||Retail Sales (MoM) (Apr)||0.4%||-0.5%|
|USD||Existing Home Sales (Apr)||5.24M||5.19M|
|USD||Philadelphia Fed Manufacturing||8.0||7.5|
Government Bond Auctions
Date Time Country
May 21 08:30 Spain Auctions Bonos
May 21 09:03 Sweden Holds bond exchange auction
May 21 09:10 France Auctions BTANs
May 21 09:30 UK Auctions 4.75% 2030 Conventional Gilt
May 21 10:10 France Auctions
May 21 15:30 Italy Announces details of CTZ/BTPei on 26 May
May 21 15:00 US Announces details of 2-year FRN on 27 May, plus 2/5/7 year
May 21 17:00 US Auctions 10-year TIPs
May 22 09:03 Sweden Holds bond exchange auction
May 22 10:00 Norway Details bond auction on 27 May