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FX.co ★ Hot forecast for GBP/USD on July 22, 2021

Hot forecast for GBP/USD on July 22, 2021

It is clear that the most significant event of the week is today's meeting of the Board of the European Central Bank, on which too many hopes are pinned. These expectations are the reason for the growth of not only the single European currency, but also the pound, which began almost immediately after the opening of the American trading session. However, everyone is most likely waiting for one big disappointment. The latest decision of the Federal Reserve System to raise interest rates from the middle of next year launched the growth of the dollar, which can only be countered by similar statements of the European Central Bank. But the situation with the European regulator is somewhat different.

The fact is that inflation in Europe has recently declined, and although there are all signs that this is only a temporary slowdown, and consumer prices will soon begin to rise again, the European Central Bank still has room for maneuver. And it is really necessary because unlike the United States, Europe is still in a state of recession, and in such a situation, even hints of an increase in interest rates can lead to undesirable consequences. In fact, the European economy is simply not ready to tighten monetary policy, and a decrease in inflation will only be an excuse to leave everything as it is, and leave plans for the future unchanged. That is, the situation will remain the same, and the dollar will be able to continue to calmly strengthen its positions.

Hot forecast for GBP/USD on July 22, 2021

It is also worth noting that at the very moment that Christine Lagarde's press conference begins, data on applications for unemployment benefits in the United States are published. And it is quite obvious that because of this, no one will pay attention to them. However, the data may be quite revealing. So, the number of initial requests should be reduced by 20 thousand, and repeated by 121 thousand. That is, the American labor market continues to recover confidently. This means that the American economy is also growing steadily.

Number of repeated applications for unemployment benefits (United States):

Hot forecast for GBP/USD on July 22, 2021

The GBP/USD currency pair, after a rapid downward move in the period of July 16-20, passed into the stage of technical correction, where the price coordinate of 1.3570 serves as a variable pivot point.

The market dynamics is full of speculators, due to which we are seeing an acceleration in the market.

In the current location of the quote, there is a local interest in long positions, which leads to the subsequent structure of the correction course.

In this situation, it can be assumed that the area of 1.3750/1.3780, where stagnation was observed in history, may become a resistance on the path of correction.

From the point of view of complex indicator analysis, it is clear that due to the rapid upward movement, technical instruments changed the buy signal on the minute and hour periods.

Hot forecast for GBP/USD on July 22, 2021

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade
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