ONLINE FOREX BROKER
2020-06-24 • Updated
Here are some interesting technical facts about the GBP/USD observable in the chat below.
First, immediately after the Brexit vote, GBP/USD dropped from 1.4750 to 1.2000 losing almost 20% of its value (1).
Second, after a year-long retrace upwards (that never managed to get back up to 1.4750), the upside of GBP/USD stabilized at 1.3400 and has never been crossed since April 2018 (2).
Third, while the resistance has been granite-fixed, the bottom has been going deeper and deeper, renewing lows and expanding the span of fluctuation (3).
Taken alone, these facts together tell about a definite weakening of the GBP that comes as a direct consequence of the Brexit vote.
On a larger scale, we see a sharp drop (1) to 1.4750 in 2008 which is “excusable” for the worldwide crisis. After that, there were five years of sideways movement (2) within the channel supported by 1.4750 and capped 1.7200.
Eventually, the GBP lost even more value against the USD (4) coming down to the current 1.2000 which seems to be a firm ground so far.
All of those movements were taking place under a fixed straight-line downtrend (3). That suggests that in the long term, GBP/USD is unlikely to move back up. More probably, it will stay at the bottom – at least, while the Brexit finalizes.
The long-term view shows a prevalent downtrend for the GBP against the USD. The tactical view shows increased volatility. Altogether, these are typical attributes to the exotic currencies representing developing economies. May that be the case for the GBP? Well, it is definitely still much stronger than the Russian ruble of Brazilian real, for example. But the inner market mechanism converts it now into something quite far away from a central G5/G10 currency, and definitely not a pillar of firmness in the world of Forex.
In other words, the GBP is becoming weak. Will it drop below 1.2000? If Brexit doesn't land well, definitely it will. If Brexit goes smooth (which is 50/50) - it will probably float at 1.2000 or slightly above. Will it ever launch back up to where it used to be? Unlikely. Times are changing – the UK economy is shrinking, and the virus damage accelerated this process.
Therefore, keep 1.3400 and 1.2800 in mind as tactical resistance levels, and 1.2000 as the key support level. Gravity is on the side of the latter.
The S&P 500 had a good week due to the impressive start of Q1 earnings and favorable inflation data. In March, the consumer price index rose 5%, lower than the previous month's 6%, and met economists' expectations.
The previous year 2022, was undoubtedly tumultuous for the stock markets, with several stocks plummeting across multiple industries. Analysts have blamed the hard times on inflation, hawkish federal reserve policies, an impending global recession, and the ongoing crisis in Ukraine. This year, however, we're beginning to see some recovery in the stock markets. This article will find a few stocks worth buying this year.
In a call scheduled for January 25, 00:30 am GMT+2, Microsoft will publish the company's earnings for the final quarter of 2022 and comment on the results, projections, and outlook for the nearest future of the company.
Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.
Hey guys, this is the last full trading week in May, and many forward-looking individuals like myself are already preparing themselves to seize whatever opportunities June may have in store. On this note, I will review a few commodities that have satisfied my quest for swing-trading opportunities in the coming month. Follow me!
The Bank of England (BoE) has dramatically shifted its economic forecasts. They no longer expect a recession in the UK and have upgraded their growth projections. This year, the BoE predicts GDP growth of +0.25%, a significant improvement from previous expectations. Next year's forecast is even more optimistic, with a projected growth of 0.75%.
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