GBP/USD Daily Forecast – 07 March

Sterling was pushed all the way to 1.41 handle on Friday, after US NFP figures, but managed to rebound by the end of the session, breaking above 1.42 handle, but finding resistance around 1.4250 level. As for Monday, any type of supportive candles around 1.4150 level and 1.41 area, would be short-term buying signal, while resistive candles above 1.4250 area, would offer short-term buying opportunity.

GBP/USD Daily Forecast – 07 March

There were no data releases from the UK on Friday. Traders are, despite recent uptrend, wary of the currency given a poor reading of the health of the Britain's huge services sector where the prospect of Britain's leaving the European Union rattled business sentiment last month. And while Britain's economy continues to outpace many of its European peers, investors have become convinced it will not be strong enough any time soon to justify a rise in interest rates. Investors worry a "Brexit", which is likely to weigh on growth and push back UK rate hike expectations, would also threaten the huge foreign investment flows Britain needs to balance its current account deficit, one of the biggest in the developed world at around 4 percent of output.

Focus of the US session was on Trade Balance and NFP figures. The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that the goods and services deficit was $45.7 billion in January, up $1.0 billion from $44.7 billion in December, revised. Deficit of $43.8 billion was anticipated. January exports were $176.5 billion, $3.8 billion less than December exports. January imports were $222.1 billion, $2.8 billion less than December imports.

Employers added more workers in February than projected but wages unexpectedly declined, dashing hopes that reduced slack in the labor market was starting to benefit all Americans. The 242,000 gain followed a 172,000 rise in January that was larger than previously estimated, a Labor Department report showed Friday. The jobless rate held at 4.9% as people entered the labor force and found work. Average hourly earnings dropped, the first monthly decline in more than a year.

There will be no data releases both from UK and USA on Monday so we can expect a bit steadier session, especially after huge movements in the pair recently.

GBP/USD Weekly Forecast – 07 March – 11 March

Events that marked the week:

Monday's session brought Net Lending to Individuals data. Total lending to individuals increased by £5.3 billion in January, compared to the average monthly increase of £4.7 billion over the previous six months. The three-month annualised and twelve-month growth rates were 4.2% and 3.5% respectively. Lending secured on dwellings increased by £3.7 billion in January, compared to the average monthly increase of £3.4 billion over the previous six months. The three-month annualised and twelve-month growth rates were 3.4% and 2.8% respectively.

GBP/USD Weekly Forecast – 07 March – 11 March

Pound broke above 1.42 handle in the course of the last week, thus completely rebounding after decline caused by Brexit concerns. As for next week we would pay attention to UK Industrial Production figures. Weaker than expected data would push pair lower with support around 1.41 and 1.4050 level in extension, so this is where we would consider buying the pair in short term-trends. On the other hand, better than forecasted figures would lead to the uptrend all the way to 1.43 and 1.4350 handle where we can expect major resistance and short-term selling opportunity. Read more...