GBPUSD Weekly Forex Forecast – 8th to 12th May 2017
The GBPUSD technical pattern has been contained inside a narrow range just below the big psychological number 1.3000. The weekly close below 1.3000 resistance level is going to perpetuate the trading range, but this weekend we have the 2nd round of French Presidential election which can change the whole picture. The most recent polls show Macron is still the favorite to become the next French president, which is a positive thing for the markets.
The risk remains to the downside for the markets as we saw with the recent elections around the world the underdog can always pull a surprise win. Macron win is not sealed and the chances remain 50-50. The French election is crucial for the survival of the 28-nation bloc as it can be the catalyst for Frexit and consequently can have the same effect on the financial markets as Brexit did.
From a technical perspective GBPUSD has posted the fourth consecutive bullish weekly candle and in a risk-on environment it can easily gap above 1.3000 and go into 1.3300 and even 1.3500 next resistance levels. However, in a risk-off environment, it’s hard to predict how stronger the sell-off will be. But, we can note the major support levels 1.2500 and more importantly the big psychological number 1.2000 if we go that far down.
While the biggest risk event remains the French elections, we can also note that on the UK economic calendar we have the BOE interest rate decision as well as the Trade balance figures which can be the source of some volatility.
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GBPUSD Weekly Forex Forecast – 8th to 12th May 2017
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