Bearish View
Set a sell-stop at 1.3750 and a take-profit at 1.3667 (lowest level this week).
Add a take-profit at 1.3800.
Timeline: 1-2 days.
Bullish View
Set a buy-stop at 1.3810 (this week’s high).
Add a take-profit at 1.4000 and a stop-loss at 1.3750.
The GBP/USD pair is going nowhere after the relatively strong UK GDP numbers published on Tuesday and the sudden resignation of Andy Haldane. It is trading at 1.3773 as traders wait for the US retail sales, manufacturing, and initial jobless claims numbers.
Little Action from London
There will be no economic numbers that will be published from the UK today. As such, traders will continue reflecting on the ongoing partial reopening as the country ramps up its vaccination efforts. Many businesses like gyms and pubs have started to reopen ahead of the full reopening in June.
This reopening is expected to fuel more growth. That is after data released on Tuesday showed that the UK economy recovered modestly in February even as the lockdown continued. The economy rose by 0.4% after falling by 3% in January. It is still 7.8% below the pre-pandemic levels. The reopening means that the economy will recover by about 5% in the second quarter.
The GBP/USD also reacted mildly to the sudden departure of Andy Haldane, the Chief Economist at the Bank of England (BOE). He heads to the RSA, a thinktank catering to the arts, manufacturing, and commerce industries. Haldane was a hawkish economist who was against negative rates. Therefore, his departure could see the bank take a more dovish tone.
Later today, focus will be in the United States, where the government will publish the latest retail sales numbers. Because of the reopening and stimulus, analysts expect that sales rebounded by more than 5% in March. The same thing happened in January after the US released a $900 billion stimulus package.
The US will also publish the latest Manufacturing Index from New York and Philadelphia. While manufacturing plays a small role in these states, the data are useful gauges of the economy. The GBP/USD will also react to the latest initial jobless claims numbers.
GBP/USD Technical Forecast
The four-hour chart shows that the GBP/USD pair is in a tight range. It is trading at 1.3773, which is slightly below this week’s high of 1.3800. The price is at the same level as the 15-day and 25-day exponential moving averages (EMA). It is also above the important support at 1.3667, which was the lowest level this week. Therefore, the pair may resume the downward trend as bears attempt to move below this week’s low.
