Hot forecast for GBP/USD on July 7, 2021

As soon as the government confirmed its intention to lift all restrictive measures imposed due to the coronavirus pandemic from July 19, the pound began to show a steady growth. But it didn't last long, and even before the opening of the American trading session, the pound began to rapidly become cheaper. Despite the wonderful plans of London, the number of new cases of coronavirus infection is only increasing. The United Kingdom is showing almost the worst results not only in Europe, but also in the world as a whole. It is clear that this raises quite serious concerns that at the last moment a decision will be made on the next postponement of the lifting of quarantine measures. The situation is further aggravated by the fact that the new Minister of Health of the United Kingdom has also contracted the coronavirus, despite being vaccinated against it.

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The American statistics on retail sales, apparently, acted only as an additional negative factor, and strengthened the weakening of the pound. Moreover, the data came out completely different from what was expected. Retail sales were forecasted to decline by 0.5%, but they grew by 0.6% instead. Although, on an annualized basis, the growth rate of retail sales slowed from 27.6% to 18.0%. But there is no point in looking at the annual data yet, since they are still distorted by the effect of a low base. In any case, instead of a decline in consumer activity, we got its growth. And we are talking about almost the main driver of the growth of the American economy.

Retail Sales (United States):

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Nevertheless, after such an impressive fall, a rebound in the pound suggests itself, albeit symbolic. The macroeconomic calendar is completely empty today, but it doesn't matter. The main factor will be the abolition of quarantine measures in the UK. Most likely, the auction will just open with a noticeable increase in the pound. Of course, the pound will not return to the values from which it began to decline last Friday. Whatever one may say, the epidemiological situation in the United Kingdom is simply appalling, and it is extremely likely that these very quarantine measures will soon be introduced again.

The GBP/USD currency pair managed to break the cycle of fluctuations between the price values of 1.3800/1.3900 last Friday. As a result, indicating the prevailing downward interest.

The market dynamics follows a high speculative interest, which leads to a fairly strong acceleration in the market.

In the current location of the quote, there is a convergence of the price with the base area of the beginning of the month of 1.3730/1.3750.

In this situation, it can be assumed that due to the local oversold status of the pound sterling, a symbolic pullback may occur, but at the same time the downward mood will remain in the market.

From the point of view of complex indicator analysis, it can be seen that technical instruments unanimously signal a sale.

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The material has been provided by InstaForex Company - www.instaforex.com

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