Lockdown Latest, Bank of England and GBP/USD, EURGBP and GBP/NZD Price Analysis:
- Sentiment may get an uplift when PM Johnson outlines lockdown unwind.
- Early start for the Bank of England (BoE) on Thursday.
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PM Boris Johnson will set out measures this week for the UK to start coming out of the six week coronavirus lockdown as scientist say that the UK infection rate peaked in mid-April and that important reproduction (R) rate is under 1. Any signs that the UK is getting set to re-open the economy in stages will give Sterling and the FTSE an uplift, although Prime Minister’s current reticence may see him favor a more cautious approach.
The Bank of England will have an early start on Thursday with the latest policy decision and monetary policy report due to be released at 7:00 UK time, five hours earlier than normal. This will coincide with the latest UK Financial Stability Report. The changeover from Asian trading to UK trading can be a volatile period with low volumes leading to out-sized price moves.
Friday sees the latest US Non-Farm Payrolls release with current market forecasting that in excess of 21 million US citizens have lost their jobs with the unemployment rate soaring to 16.0% from 4.4%.
EURGBP has been rangebound for the last month and looks set to remain between 0.8678 and 0.8865 in the near future. The CCI indicator is showing the market in overbought territory and the pair may drift to the lower bound of the range if they can break and close below the 61.8% Fibonacci Retracement level at 0.8747.
EUR/GBP Daily Price Chart (October 2019 – May 4, 2020)
| Change in | Longs | Shorts | OI |
| Daily | 28% | 7% | 18% |
| Weekly | -16% | 3% | -9% |
GB/NZD remains underpinned around the 2.0250 area but a recent series of lower swing-highs may keep bulls on the sidelines for now. The longer-term trend of higher swing-lows is still valid but the pair need to break above 2.0834 to re-establish bullish momentum.
GBP/NZD Daily Price Chart (August 2019 – May 4, 2020)
GBP/USD has bounced off the high end of the 1.2380/1.2410 cluster of recent lows and pushed back to 1.2445. Short-term resistance likely off the 1.2518 Fibonacci retracement level.
British Pound (GBP) Latest: GBP/USD Stalls, FTSE 100 Uneasy as US-China Tensions Increase
Traders may be interested in two of our trading guides – Traits of Successful Traders and Top Trading Lessons – while technical analysts are likely to be interested in our latest Elliott Wave Guide.
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