Daily Analysis GBPUSD - 3 July 2023

Consumer confidence in the UK improved in June, reaching its highest level since January 2022. The British economy has managed to avoid a predicted recession, as indicated by the GfK Consumer Confidence data. However, concerns about a potential recession and the Bank of England's actions continue to weigh on the GBP/USD pair. The BoE surprised the market by raising interest rates by 50 basis points, leading to a temporary spike in the pound but later a decline. The Pound Sterling faces downward pressure despite the rate hike due to expectations of an earlier end to the tightening cycle. In the US, the Federal Reserve Chairman reiterated previous remarks, while the US Dollar had a strong week but was impacted by softer-than-expected inflation figures, reducing expectations of future rate hikes.

Currently, the GBP/USD pair is demonstrating a downward trend in the short term, with the support level identified around 1.2600-1.2550. A decisive drop below this level has the potential to indicate the conclusion of the prevailing bullish long-term trend.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3200	1.3000	1.2800	1.2650	1.2540	1.2460