GBP/USD: forecast for Aug 31-Sept 6
GBP/USD surge above 1.5700 turned out to be a fake breakout – the pair lost more than 300 pips by the end of the week. A strong bearish candle is being formed on the weekly chart (SELL signal). The cable broke the trendline connecting the May-August lows to the downside.
Weekly close below 1.5450 will become a strong signals for the sellers. Next levels to watch are 1.5330 и 1.5170. They are expected to be reached in the coming days. Recovery above 1.5500 is needed to revive the buying demand.
Next week we’ll watch the UK August PMI indices. Monday is a bank holiday – volatility could increase on a thin market. Weak US data and a new wave of Asian market selloff is a risk to our bearish view, however.