GBPUSD: New Higher High or Profit-Taking After Last Week's Gains.
- TradingAddictEu
- Jul 8, 2024
- 2 min read
The lack of a decision to cut rates in June significantly strengthened the GBPUSD, and the pair is performing very well. This week, we have the release of the UK's GDP data for May. However, undoubtedly, the focus will be on the US CPI data. A decrease in inflation will weaken the dollar, while an increase may strengthen it temporarily.
The question for this week is whether we will see profit-taking or a rise to new highs before the Thursday CPI releases.
Time Frame D1
On the daily chart (D1), we see a strong upward movement from support above the 200 SMA. GBPUSD has reached resistance at the recent highs. At the beginning of the day, GBPUSD performed well despite difficulties with EURUSD and profit-taking in gold.
The key factor will be the situation in the US stock market. If the session is weak, it may prompt traders to take profits from recent gains. In this case, GBPUSD is unlikely to head north alone.
Time Frame H1
On the hourly chart (H1), we are approaching a resistance zone, and the strength of the rise is diminishing. We are likely to see a pullback, partial profit-taking, but whether there will be a move towards the 200 SMA on H1 or a return to gains will be decided by the second part of the US session.
Time Frame M15
The 15-minute chart (M15) shows that the price is starting to bounce off support. Buyers are unable to sustain the gains. USDCHF is performing well (dollar gaining), EURUSD is weakening, and there is a sell-off in gold.
In summary, if today's US session does not provide additional strength, we will likely see profit-taking in GBPUSD as well.
Economic Calendar for This Week
Key data that may impact the market include:
Tuesday: US - Fed Chair Powell's speech,
Wednesday: NZD - interest rate decision,
Wednesday: USD - Fed Chair Powell's speech,
Thursday: GBP - GDP data (May),
Friday: USD - CPI (June).
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