Forex. GBP/USD trading forecast and signal for today, May 6, 2021
Forex pair Pound/Dollar is trading just above the level of 1.3900.
No major changes are expected, as the market has been stuck in a neutral sideways range for the past two months. According to analysts at Credit Suisse, the pair's growth will begin only when the strong level of 1.4000 is broken. The nearest support is located at 1.3800. Quotes cannot leave the range due to a combination of opposite factors. The US and UK economies are recovering at a fairly rapid pace, the latest indicators show stable growth. There are concerns about a recovery in UK inflation, but this is not yet enough for a full-fledged downtrend.
According to the Bloomberg review, the forex pair Pound/Dollar exchange rate will remain at today's values until June. But some analysts confidently predict a decline in quotations. Credit Agricole recommends selling the pound against the dollar in the short term, one of the reasons is the political risk over Scottish independence. Analysts at Barclays Bank declined a call to open a long position on the pound against the euro due to potential pre-election volatility. UBS lowered its forecast for a select group of UK bank bonds to neutral and warned that a long position on UK credit instruments could prove unprofitable due to the risk of a referendum. The odds show that a repeat of the events of 2014, when Scotland voted to remain united, remains a distant prospect. However, market participants put this scenario in their estimates.
GBP/USD trading signal for today May 6, 2021
In the forecast, forex pair Pound/Dollar is expected to decline to the supports of 1.3900, 1.3875 and 1.3850.