During the week, the GBP/USD pair was trading in the main range of 1.3900-1.3800, which was largely due to conflicting data from the United States.
GBP/USD Pound Dollar forecast for July 19-20, 2021
The increase in inflation in the country led to the strengthening of the US currency, as it raised investors' hopes for the early start of the correction of the US Federal Reserve's monetary policy. However, the head of the regulator, Jerome Powell, speaking to Congress, said that it was necessary to continue stimulating the economy, although he admitted that the issue of reducing the volume of asset purchases is being discussed by officials. Against the background of this rhetoric, the GBP/USD pair regained some of the lost positions.
Currently, the price is growing, supported by positive data from the United Kingdom labor market. In June, the number of employees in British companies increased to the highest value since the beginning of the pandemic, increasing by 356 thousand people. The average salary level in May, including bonuses, increased by 7.3%. In addition, the pound supports the expectation of the opening of the British economy, which will take place next Monday. It is expected that after the removal of most quarantine restrictions, it will receive a new impetus to recovery.
Today, American investors are waiting for the publication of June retail sales data. They may decline for the second time in a row (by 0.4%), which will create pressure on the dollar.
Support and resistance levels
The key for the "bulls" is the support zone 1.3900–1.3916 (Murray [4/8]) within the forex forecast. Its breakdown will give the prospect of growth to the levels of 1.4038 (Murray [6/8]) and 1.4100 (Murray [7/8]). If the price is fixed below the level of 1.3800, the decline can continue to the levels of 1.3732 (Murray [1/8], the lower line of the Bollinger bands) and 1.3672 (Murray [0/8]).
The indicators do not give a clear signal: the Bollinger bands are unfolding horizontally, the Stochastic is directed down, the MASD histogram is shrinking in the negative zone.
Resistance levels: 1.3912, 1.4038, 1.4100.
Support levels: 1.3800, 1.3732, 1.3672.
Trading Scenarios
Thus, GBP/USD forecast pound dollar for July 19-20, 2021, long positions should be opened above the 1.3912 mark with targets of 1.4038, 1.4100 and a stop loss of 1.3840. Implementation period: 5-7 days.
Short positions can be opened below the level of 1.3800 with targets of 1.3732, 1.3672 and a stop loss of 1.3850.