Bearish bias on GBPUSD
For GBP, BOE Governor Bailey came out with some downbeat comments on the British economy, prompting traders to question how aggressively the central bank will raise interest rates throughout the rest of the year. That, combined with technical selling below the key 1.30 level led to a near 200-pip collapse in the pair on Friday. GBPUSD fell below 1.3000 to its lowest level in 17 months due to a weak retail sales report.
USD continues to maintain positive outlook however may see some volatility depending on data release on coming Friday.
Technically, a clear change of character (CHoCH) to the downside, followed by a steep decline forming an imbalance ( IMB ) and trend continuation confirmed by bearish break of structure (BoS) shows that a bearish trend may continue to develop over the next week. However, due to the imbalance formed, I expect some form of short term bullish rally to fill the gap, bringing price higher towards the recently marked unmitigated blue order block before continuing to the downside.
USD continues to maintain positive outlook however may see some volatility depending on data release on coming Friday.
Technically, a clear change of character (CHoCH) to the downside, followed by a steep decline forming an imbalance ( IMB ) and trend continuation confirmed by bearish break of structure (BoS) shows that a bearish trend may continue to develop over the next week. However, due to the imbalance formed, I expect some form of short term bullish rally to fill the gap, bringing price higher towards the recently marked unmitigated blue order block before continuing to the downside.
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