TriumphFX Forex Analysis – GBP Pairs – February 2020


 

GBPAUD – Daily & 4 Hour Charts

 

GBPAUD is up-trending on the daily chart. Price has formed a daily bullish channel and is clearly bullish. The moving averages are bullish and widening, signalling that the uptrend could continue.

On the 4 hour chart, GBPAUD is currently up-trending within a tight bullish channel. Overall, price is moving in an upward direction. The moving averages are bullish and steady, suggesting that the upside direction could continue.

Opportunities to go long may exist around the daily and 4 hourly bullish channel support areas, around the daily and 4 hourly dynamic support of the moving averages and around the horizontal levels at 1.9180 and 1.9115. A bullish move could be rejected or reverse around the channel resistance areas on the daily and 4 hourly charts and around the horizontal resistance at 1.9740.

The Bank of England (BOE) continues to hold interest rates at 0.75% – 50 base points higher than the 2016 & 2017 low of 0.25%. There is some concern that rates will be cut due to the concern in the job market. The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound. The Reserve Bank of Australia (RBA) cut rates again in their October 2019 meeting. Rates were cut by 0.25%, bringing the official bank rate to 0.75% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate economy. The RBA will continue to monitor the labour market. It is likely that official rate will stay low and may even be cut further.

 

GBPCAD – Daily & 4 Hour Charts

 

On the daily time-frame, price is looking indecisive. The GBPCAD is moving sideways and has no clear market direction. The moving averages confirm the market indecision – they have been moving sideways and have been crossing frequently.

Price is also looking indecisive on the 4 hour time-frame. The moving averages once again confirm the market indecision – they are moving sideways and have been crossing frequently. GBPCAD may start ranging between 1.7110 and 1.7475.

Trading opportunities could exist around the daily and 4 hourly moving averages and around the identified horizontal levels at 1.6930, 1.6945, 1.7110, 1.7310, 1.7475 and 1.7735.

The Bank of Canada (BOC) continues to raise interest rates at a steady pace. The current rate is 1.75% – it’s highest since December 2008. The economy is currently performing well and inflation targets are currently at their potential, meaning that the rate of 1.75% may not change in the near future. The Bank of England (BOE) continues to hold interest rates at 0.75% – 50 base points higher than the 2016 & 2017 low of 0.25%. There is some concern that rates will be cut due to the concern in the job market. The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

 

GBPCHF – Daily & 4 Hour Charts

 

The GBPCHF is lacking trend direction on the daily time-frame – price is indecisive. The moving averages have been crossing frequently and are moving sideways – confirming the current indecision. Price is forming lower swing highs around 1.3300 and has formed a diagonal resistance area, suggesting that GBPCHF could move lower.

The 4 hour time-frame is also showing indecision. Price action has formed a horizontal channel at 1.2535-1.2825.

Trading opportunities may exist around the support and resistance areas of the 4 hour horizontal channel and if the GBPCHF moves out of the channel (break-out trade). A break to the upside could find resistance around the daily diagonal resistance and around the hori

The Bank of England (BOE) continues to hold interest rates at 0.75% – 50 base points higher than the 2016 & 2017 low of 0.25%. There is some concern that rates will be cut due to the concern in the job market. The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound. The Swiss National Bank (SNB) continues to keep rates at the all-time low of -0.75%. The Swiss economy continues to be stagnant but has been showing signs of positive momentum. The Swiss Franc continues to be highly valued, especially due to the current global uncertainties around Brexit and the US. The SNB has announced that it will continue to intervene with in foreign exchange markets but will likely keep rates unchanged until at least 2021.

 

GBPJPY – Daily & 4 Hour Charts

 

Just like other GBP pairs, the GBPJPY is looking indecisive and is lacking trend momentum. Price is currently moving within a tight range at 141.05-144.30. The moving averages confirm the indecision – they have been crossing frequently.

The horizontal channel is showing more clearly on the 4 hour time-frame. The moving averages are clearly signalling indecision.

Trading opportunities could exist around the support and resistance areas of the horizontal channel and if GBPJPY moves out of the channel (break-out trade). A break to the upside may find resistance around 147.45 and 148.30.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. The Bank of England (BOE) continues to hold interest rates at 0.75% – 50 base points higher than the 2016 & 2017 low of 0.25%. There is some concern that rates will be cut due to the concern in the job market. The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

 

GBPNZD – Daily & 4 Hour Charts

 

Price has been up-trending on the daily chart but is currently ranging between the recent swing low at 1.9465 and the horizontal resistance at 2.0415. The moving averages are bullish and price action has formed a trend support area, all signalling that GBPNZD could break to the upside of the range.

Price is also ranging on the 4 hour time-frame (2.0000-2.0415). Once again, GBPNZD has been up-trending and the moving averages are bullish, signalling a potential upside break.

Trading opportunities may exist around the support and resistance areas of the 4 hour and daily ranges and if price closes out of either range (break-out trade).

The Bank of England (BOE) continues to hold interest rates at 0.75% – 50 base points higher than the 2016 & 2017 low of 0.25%. There is some concern that rates will be cut due to the concern in the job market. The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound. The Reserve Bank of New Zealand (RBNZ) continue to keep rates at the record low of 1.00%. Due to poor economic indicators, there are no forecast rate hikes in the near future but further cuts are currently being disregarded for the remainder of 2020. The US Federal Open Market Committee (FOMC) has cut rates by a further 25 points due to heightened concerns regarding the economy.

 

GBPUSD – Daily & 4 Hour Charts

 

Just like most other GBP pairs, GBPUSD is indecisive and is lacking trend direction. The moving averages are bullish and steady though, suggesting potential upside.

GBPUSD is down-trending on the 4 hour chart. Price action has formed a bearish channel. The moving averages are bearish and steady, signalling that the downside direction may continue.

Opportunities to go short could exist around the 4 hour moving averages, around the 4 hour bearish channel resistance area and around the horizontal resistance levels at 1.3200, 1.3260 and 1.3470. A bearish move may stall or reverse around the bearish channel support area and around the horizontal support levels at 1.2875 and 1.2775.

The US Federal Open Market Committee (FOMC) has cut rates by a further 25 points due to heightened concerns regarding the economy. The current Fed Funds rate is currently 1.75%. The current monetary plan is to keep the rate unchanged for the foreseeable future. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. Overall, the US economy is performing well and inflation is at an acceptable rate. The Bank of England (BOE) continues to hold interest rates at 0.75% – 50 base points higher than the 2016 & 2017 low of 0.25%. There is some concern that rates will be cut due to the concern in the job market. The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

 

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