The market sentiment is mixed as US stocks rise and European bourses fall.
The Russia-Ukraine front has positive news that could lead to a ceasefire between the two countries.
USD Price Forecast: The pair is aiming towards 1.3100.
The GBP/USD pairing fell for the second consecutive day Thursday. This was due to a risk-on mood that usually favors the British pound but US central bank hawkishness, broad US dollar strength and general US central bank hawkishness weighing on the pair. The GBP/USD trades at 1.3173 as of the writing.
As mentioned, the market sentiment has turned sour in recent months. European indices ended Thursday with losses. However, US stocks remain positive. The FX space sees the greenback hovering around 98.89 per US Dollar Index. This is close to the 99.00 mark while US Treasury yields are rising.
With reports that NATO’s two day summit is underway, the Russia-Ukraine war is once again front and center of news headlines. A senior US administration official claims that the US President Biden stated to NATO that he supports increased NATO troops in the east. It is important to note that there have been positive developments in Eastern Europe. According to Axio’s correspondent, Andriy Yaermak, the Ukrainian Chief of Staff, stated that there had been progress in ceasefire negotiations with Russia. He also expressed “careful optimism”.
Fed’s Kashkari crossed wires with Evans
The Minnesota Fed President Neil Kashkari stated that there is a risk of raising rates too much. He also stated that neutral rates are expected to remain at around 2%. He also stated that he sees neutral rates at around 2%.
The UK economic docket featured March Composite PMI for UK. This figure dipped to 59.5 vs February’s 59.5 figure. However, it was higher than the 57.8 forecast.
In the US economic docket, Initial Jobless Claims were reported for the week ending March 19, the lowest since 1969. This reading was 187K lower that the 212K expected. The Markit PMIs March were released later in the day. They came out better than expected.
GBP/USD Forecast: Technical outlook
According to the chart, GBP/USD is moving downwards. The rally stopped at 1.3275 on Tuesday, but the pair crossed the 1.3300 mark Wednesday. However, the 50-day moving mean (DMA), which is just below the 100-DMA at 1.3402 & 1.3400, was about to cross the 100-DMA.
The GBP/USD’s first support would be at 1.3160 on December 8, 2021. Brute of this would expose November 13, 2020’s daily low at 1.3105. Then, there is the bottom-trendline for a downward channel around the 1.3020-40 area and the 1.3000 mark.
