British Pound: USD/GBP (GBP=X) weakens as Trump plays down US recession fears
The GBP/USD exchange rate is currently trading at $1.2110, down around 0.3 percent from this morning’s opening rate.The US dollar is trending higher this afternoon after US President Donald Trump played down fears for a US recession in 2020.
Speaking to reporters on Sunday, President Trump claimed the recession was the prediction of only a few economists while extolling the virtues of his own tax cuts: “We are doing tremendously well. Consumers are rich, tax cut loaded up with money. I saw Walmart numbers through the roof, better than any poll.” Fears for a US recession spiralled last week when the US bond yield curve inverted for the first time in over a decade, an event traditionally viewed as an early indicator of a downturn.
Following the Fed’s July policy decision, Mr Powell, insisted the central bank’s first rate cut in over a decade would not mark the start of a new easing cycle.
However, rising trade uncertainty and signs of a possible US recession have since reignited speculation the Fed may be making provision for further cuts.
If Mr Powell reneges on his previous assurances and signals another cut in September this would see the US dollar stumble at the end of the week.
In the absence of any notable UK economic data, political headlines will be the main catalyst for movement in the pound this week.
GBP exchange rates are likely to fluctuate throughout the session as Jeremy Corbyn’s attempt to garner support for a no-confidence vote in Boris Johnson and cross-party solidarity against a no-deal Brexit gather steam.
Overall, the bias in prices is: Downwards.
By the way, prices are vulnerable to a correction towards 1.24.
The projected upper bound is: 1.23.
The projected lower bound is: 1.20.
The projected closing price is: 1.21.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 21 white candles and 29 black candles for a net of 8 black candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 71.3955. This is not an overbought or oversold reading. The last signal was a buy 11 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 38.61. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 3 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 28. This is not a topping or bottoming area. The last signal was a buy 11 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 3 period(s) ago.
Rex Takasugi – TD Profile
FOREX GBP= closed up 0.000 at 1.213. Volume was 99% below average (consolidating) and Bollinger Bands were 27% wider than normal.
Open High Low Close Volume___
1.212 1.214 1.212 1.213 1,523
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.21 1.24 1.28
Volatility: 7 8 9
Volume: 103,548 116,621 157,036
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX GBP= is currently 5.2% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of GBP= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on GBP= and have had this outlook for the last 30 periods.