GBP - Sterling remains stable

This week the market will focus on the U.S. Federal Open Market Committee (FOMC) meeting and the U.S. April employment report; a series of strong U.S. data and hawkish comments from Fed officials have led to widespread expectations that the Fed will remain on hold on Wednesday. Currently, the market expects that the probability of the Fed cutting interest rates by 25 basis points at the June meeting is only 10%, while after the March meeting, this possibility was close to 85%. The meeting statement and Chairman Powell's press conference are expected to reiterate that the Fed will still rely on data and is in no rush to ease policy. The Fed is expected to keep its target interest rate range unchanged at 5.25%-5.5% at the end of Wednesday's meeting, according to CME's FedWatch tool. In addition, the market is also paying close attention to the U.S. non-farm payrolls data released on Friday for clues about the Federal Reserve cutting interest rates.

The trend of GBP/USD, as seen on the technical chart, the MACD indicator broke above the signal line, and the 5-day moving average has just broken above the 10-day moving average. It is expected that the pound and the US dollar will still tend to remain stable. The lowest support will be seen at 1.2430 and 1.23 levels, and the next level points to 1.2180 level. As for the resistance level, it is expected to point to the 250-day moving average at 1.2575 and 1.27 levels, and the greatest resistance is expected to be 1.2820.

Forecast range:
Resistance 1.2575 – 1.2700 – 1.2820
Support 1.2430 - 1.2300* - 1.2180

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