GBP/USD Daily Fundamental Forecast

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GBP/USD Daily Fundamental Forecast – December 27, 2017

Colin First

Updated Tue, Dec 26, 2017, 8:04 PM

It was a holiday in most parts of Europe yesterday, including the UK, and hence it was only expected that the pound continued to consolidate and trade within a tight range for most of the day yesterday. The GBPUSD pair is caught within a tight range as there have not been many major fundamental developments in the markets and this has led to some tight trading.

GBPUSD Continues in Range

With many of the traders on holiday, it was only expected that the volatility and the liquidity would be low. There has not been much of position trading and it has been more of profit taking over the last week or so. The profit taking can be seen more in the smaller markets like the bitcoin market but it has not been so obvious in markets such as the pound which is a much bigger one and hence been able to absorb any kind of selling that the traders might attempt before going off on their holidays.

The liquidity and the volatility is expected to pick up only during the second week of January and till that time, we can only expect some more of choppiness and ranging as we wind down to the rest of the year. The markets reopen in Europe after the long weekend but we doubt whether there would be many traders around this week as many of them would want to take an extended holiday till the end of the New Year. So expect this consolidation and ranging to continue for the next few days as well.

Looking at the rest of the day, we have the CB consumer confidence data from the US which is unlikely to bring in too much of volatility in the markets. We do not have any major economic news from the UK and hence expect some slow and low markets and trading for the rest of the day.

This article was originally posted on FX Empire