GBP/USD forecast for April 14, 2023. GBP stays within upward channel
April 14, 2023 11:22 am
On the 1-hour chart on Thursday, the GBP/USD pair continued its growth and settled above the 1.2524 level. The pair remains within the ascending trend channel, which characterizes traders’ sentiment as bullish. At the moment, the pound is moving strictly within the upward channel and is struggling to settle below it. There are very few reasons to sell the pound at the moment. The pair may continue to rise towards the 1.2588 and 1.2623 levels.
Yesterday, there was plenty of statistical data for the British pound. Let’s start with the February GDP report which showed zero growth in the British economy. In three months, GDP grew by 0.1%. Industrial production contracted by 0.2% MoM and lost 3.1% YoY. Overall, the data from the UK turned out to be worse than expected. In the US, the Producer Price Index (PPI) fell by 0.5% in March. In annual terms, it amounted to 2.7%, showing a decrease from 4.9%. This is a significant slowdown, and the PPI is a harbinger of regular inflation. If producer price growth slows down, so will the prices of goods on store shelves, which is what the Federal Reserve wants to achieve. The number of initial jobless claims in the US amounted to 240,000 versus a slightly lower forecast. Overall, the US data was not in favor of the US dollar, while the morning statistics were not in favor of the pound. As a result, the British currency has been trading moderately higher for the whole day, retaining the bullish bias. At the moment, I do not see any strong reasons for the pound to fall. However, it has been rising for too long, and economic data does not always support the bulls. I think that we can talk about a real decline in the pair only if it closes below the trend channel.
On the 4-hour chart, the pair settled below the ascending trend channel, but a bullish divergence of the CCI indicator allowed the price to return to the 1.2441 level and hold firmly above it. Thus, the price may continue to rise towards the retracement level of 100.0% at 1.2674. At the moment, the MACD indicator shows that the bearish divergence is coming. Unless it is canceled in the near time, the pair may slightly decline.
COT report
The sentiment of the non-commercial group of traders changed significantly over the last reporting week. The number of long contracts held by speculators increased by 18,060, while short contracts rose by 8,769. The overall sentiment of major market players remains bearish, with the number of short positions still exceeding the number of long ones. Over the last few months, the situation has been changing in favor of the pound sterling, but the difference between the number of long and short contracts held by speculators remains significant. Thus, the outlook for the pound has been improving although GBP has been trading without significant changes in the last few months. On the 4-hour chart, the price has left the descending channel which is why the pound could be strengthening. However, there are many contradicting factors at the moment, and the information background provides little support for the sterling. On the 4-hour chart, the pair may close below the ascending channel.
Economic calendar for US and UK:
US – Retail Sales (12-30 UTC)
US – Industrial Production (12-30 UTC).
US – Michigan Consumer Sentiment (14-00 UTC).
On Friday, only the US economic calendar has some events to follow. Yet, these reports are of minor importance. Therefore, the influence of the information background on traders’ sentiment will be moderate today.
GBP/USD forecast and trading tips
I recommend selling the pound if the price closes below the ascending channel or if it rebounds from the 1.2588 level on the 1-hour chart with the targets at 1.2524 and 1.2447. Buying the pound was possible when the price closed above the 1.2441 level on the 4-hour chart, with the targets at 1.2524 and 1.2588. The first target has been reached so we can partially take profit.
The material has been provided by InstaForex Company – www.instaforex.com
On the 1-hour chart on Thursday, the GBP/USD pair continued its growth and settled above the 1.2524 level. The pair remains within the ascending trend channel, which characterizes traders’ sentiment as bullish. At the moment, the pound is moving strictly within the upward channel and is struggling to settle below it. There are very few reasons to sell the pound at the moment. The pair may continue to rise towards the 1.2588 and 1.2623 levels.
Yesterday, there was plenty of statistical data for the British pound. Let’s start with the February GDP report which showed zero growth in the British economy. In three months, GDP grew by 0.1%. Industrial production contracted by 0.2% MoM and lost 3.1% YoY. Overall, the data from the UK turned out to be worse than expected. In the US, the Producer Price Index (PPI) fell by 0.5% in March. In annual terms, it amounted to 2.7%, showing a decrease from 4.9%. This is a significant slowdown, and the PPI is a harbinger of regular inflation. If producer price growth slows down, so will the prices of goods on store shelves, which is what the Federal Reserve wants to achieve. The number of initial jobless claims in the US amounted to 240,000 versus a slightly lower forecast. Overall, the US data was not in favor of the US dollar, while the morning statistics were not in favor of the pound. As a result, the British currency has been trading moderately higher for the whole day, retaining the bullish bias. At the moment, I do not see any strong reasons for the pound to fall. However, it has been rising for too long, and economic data does not always support the bulls. I think that we can talk about a real decline in the pair only if it closes below the trend channel.
On the 4-hour chart, the pair settled below the ascending trend channel, but a bullish divergence of the CCI indicator allowed the price to return to the 1.2441 level and hold firmly above it. Thus, the price may continue to rise towards the retracement level of 100.0% at 1.2674. At the moment, the MACD indicator shows that the bearish divergence is coming. Unless it is canceled in the near time, the pair may slightly decline.
COT report
The sentiment of the non-commercial group of traders changed significantly over the last reporting week. The number of long contracts held by speculators increased by 18,060, while short contracts rose by 8,769. The overall sentiment of major market players remains bearish, with the number of short positions still exceeding the number of long ones. Over the last few months, the situation has been changing in favor of the pound sterling, but the difference between the number of long and short contracts held by speculators remains significant. Thus, the outlook for the pound has been improving although GBP has been trading without significant changes in the last few months. On the 4-hour chart, the price has left the descending channel which is why the pound could be strengthening. However, there are many contradicting factors at the moment, and the information background provides little support for the sterling. On the 4-hour chart, the pair may close below the ascending channel.
Economic calendar for US and UK:
US – Retail Sales (12-30 UTC)
US – Industrial Production (12-30 UTC).
US – Michigan Consumer Sentiment (14-00 UTC).
On Friday, only the US economic calendar has some events to follow. Yet, these reports are of minor importance. Therefore, the influence of the information background on traders’ sentiment will be moderate today.
GBP/USD forecast and trading tips
I recommend selling the pound if the price closes below the ascending channel or if it rebounds from the 1.2588 level on the 1-hour chart with the targets at 1.2524 and 1.2447. Buying the pound was possible when the price closed above the 1.2441 level on the 4-hour chart, with the targets at 1.2524 and 1.2588. The first target has been reached so we can partially take profit.
The material has been provided by InstaForex Company – www.instaforex.com
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