TriumphFX Forex Analysis – GBP Pairs – June & July 2020


EURGBP – Daily and 4 Hour Charts

EURGBP Daily Chart
EURGBP 4 Hourly Chart

The EURGBP continues to be indecisive and lack trend direction.

Price is moving within a large weekly horizontal channel at 0.8300-0.9320. The daily and 4 hourly moving averages confirm the market indecision – they have been crossing frequently and are moving sideways.

Trading opportunities could exist around the support and resistance areas of the range and around any of the identified horizontal levels at 0.8680, 0.8865 and 0.9015. If the EURGBP closes out of the weekly range, price may finally have some clear trend direction.

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

The European Central Bank (ECB) continue to keep rates at the record low of 0.00%. Rates have not been cut into negative territory, despite the COVID-19 outbreak. Instead, the ECB has launched an asset buying program. Due to weak trade growth and economic forecasts, rates are likely to stay low for the foreseeable future. The COVID-19 pandemic is just another economic challenge for the Euro zone.

GBPCAD – Daily and 4 Hour Charts

GBPCAD Daily Chart
GBPCAD 4 Hourly Chart

Just like other Canadian Dollar pairs, GBPCAD has been moving sideways and is lacking trend direction. Price continues to be indecisive (as suggested in our last GBP chart analysis).

The daily moving averages confirm the current indecision – they are tightening and are moving sideways.

GBPCAD is also looking indecisive on the 4 hour chart. Price action has formed a tight horizontal channel at 1.6855-1.7090.

Trading opportunities may exist around the daily moving averages and around the identified horizontal levels at 1.5875, 1.6610, 1.6855, 1.7090, 1.7665 and 1.7860.

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

The Bank of Canada (BOC) followed the US by slashing it’s benchmark interest rate. The intent of the rate cut is to help boost the economy during the COVID-19 pandemic. The current rate is now 0.25%. The economy is currently performing well and inflation targets are currently at their potential. If coronavirus fears deescalate, the BOC could increase rates again in the near future.

GBPJPY – Daily and 4 Hour Charts

GBPJPY Daily Chart
GBPJPY 4 Hourly Chart

As suggested in our last GBP chart analysis, price has been choppy and indecisive.

GBPJPY continues to range between the daily levels at 125.80 and 147.40. Recent price action has formed a short series of higher swing highs and higher swing lows though, suggesting that the GBPJPY may start up-trending. The daily moving averages continue to signal indecision though – they have been crossing frequently and are moving sideways. Price action has formed a bullish channel.

The 4 hour time-frame is showing a clear uptrend. The moving averages are currently bullish and widening, suggesting that the GBPJPY may move higher.

Opportunities to go long could exist around the daily bullish channel support areas, around the dynamic support of the 4 hour moving averages and around the horizontal support levels at 129.30 and 125.80. A bullish move may be rejected or reverse around the channel resistance area, around the daily longer-term moving average and around the horizontal levels at 139.40, 141.00, 144.50 and 147.40.

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. COVID-19 recession fears could stunt economic growth though.

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

GBPUSD – Daily and 4 Hour Charts 

GBPUSD Daily Chart
GBPUSD 4 Hourly Chart

Price has reversed around the daily trend resistance area and the longer-term moving average (as suggested in our last GBP technical analysis).

GBPUSD has been down-trending but price action has formed a short series of higher swing highs and higher swing lows on the daily chart, suggesting that downside momentum could be weakening. The moving averages have been crossing frequently and are moving sideways, signalling market indecision.

Price has been bullish on the 4 hour time-frame. The moving averages signal market indecision on the 4 hour also – they are moving sideways and have been crossing frequently.

Trading opportunities may exist around the moving averages, around the diagonal resistance area and around the horizontal levels at 1.1490, 1.2015, 1.2080, 1.3205, 1.3250 and 1.3465.

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

The Federal Reserve has announced a record breaking stimulus package, aimed at US households and employers. The US Federal Open Market Committee (FOMC) has unexpectedly cut rates by 150 points due to heightened concerns regarding the COVID-19 outbreak. The current Fed Funds rate is currently 0.25%, back at post-2008 levels. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. The USD has been acting as a safe haven amid the COVID-19 outbreak. There are some concerns that the COVID-19 pandemic may hit the US hardest, causing a reversal of the recent USD strength.

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