Although small in terms of the size of the country and the scale of the economy, Britain is listed as one of the largest economic forces in the world. Pound Sterling has an important role in the world of international finance, which then make it as one of the popular options for forex traders to position.
For more than a millennium, Britain is one of the strongest ranks of the nation. The UK economy is one of the largest, and a country composed of only a few small islands is capable of dominating international trade. In those days, Poundsterling acted as one of the world's currency unofficially. After the world war, Britain entered a period of economic decline, while the United States grew to become one of the most dominant forces in the world economy. Slowing economic growth in the UK is also due to heavy local government regulation, and coupled with labor markets that are too tight, making economic activity less active.
Nevertheless, Britain is still trying to improve its condition; And since the 1980s, Britain has regained much of its economic power. This resurrection coincided with the inception of Britain's central role in financial activities on a global scale. Along with the accumulation of bankers from England and abroad in the city of London, the Financial Sector became one of the most important sectors in the UK's economic activity. And therefore, the direction and strength of the financial sector have a great influence in determining the direction of the UK economy going forward.
The US Dollar and British Pound are continuously traded continuously, both in the past, and in the present. Pair also has the nickname "The Cable" or just "Cable" among forex traders; Considering in the early days of the forex market the bid and ask price was delivered from London to New York (and vice versa) using submarine cables stretching across the Atlantic Ocean.
Characteristics of pair GBP / USD
Here are the characteristics of GBPUSD pair:
The following are the characteristics of the GBPUSD:
Spread from broker (average): 2-3 pips. Note: this number can become wider as the Brexit case progresses.
Daily range (average): 150-200 pips
Best trading time: London Session and New York Session (2pm - 3am). For more information on this subject please read the Optimum Forex Trading Time article;
Factors that influence the movement of GBP / USD pair
For more than a millennium, Britain is one of the strongest ranks of the nation. The UK economy is one of the largest, and a country composed of only a few small islands is capable of dominating international trade. In those days, Poundsterling acted as one of the world's currency unofficially. After the world war, Britain entered a period of economic decline, while the United States grew to become one of the most dominant forces in the world economy. Slowing economic growth in the UK is also due to heavy local government regulation, and coupled with labor markets that are too tight, making economic activity less active.
Nevertheless, Britain is still trying to improve its condition; And since the 1980s, Britain has regained much of its economic power. This resurrection coincided with the inception of Britain's central role in financial activities on a global scale. Along with the accumulation of bankers from England and abroad in the city of London, the Financial Sector became one of the most important sectors in the UK's economic activity. And therefore, the direction and strength of the financial sector have a great influence in determining the direction of the UK economy going forward.
The US Dollar and British Pound are continuously traded continuously, both in the past, and in the present. Pair also has the nickname "The Cable" or just "Cable" among forex traders; Considering in the early days of the forex market the bid and ask price was delivered from London to New York (and vice versa) using submarine cables stretching across the Atlantic Ocean.
Characteristics of pair GBP / USD
Here are the characteristics of GBPUSD pair:
The following are the characteristics of the GBPUSD:
Spread from broker (average): 2-3 pips. Note: this number can become wider as the Brexit case progresses.
Daily range (average): 150-200 pips
Best trading time: London Session and New York Session (2pm - 3am). For more information on this subject please read the Optimum Forex Trading Time article;
Factors that influence the movement of GBP / USD pair
Similar to the EUR / USD pair, one important factor that you can consider when analyzing this pair is the condition / economic strength of each country. When America's performance in the economy is higher / stronger than the UK, the US Dollar will increase in value compared to Pound Sterling. However, if the development of the British economy exceeds the United States, then the opposite will happen. One of the indicators that we can use to see the economic strength between these two countries is by looking at the interest rate in each country. Also, as both countries have a fairly advanced financial sector, the performance of each country's financial sector is also an important indicator in weighing the strengths of each country, which will then be reflected in the value of each currency.
One of the unique things happening now is the influence of the British exit from the EU membership, or what is commonly referred to as Brexit. And with the case, the GBP currency (and GBP / USD pair) currency movements are becoming more volatile and difficult to predict. Pair GBP / USD has a high correlation impact on the movement of the US Dollar Index when compared with other currencies. In addition, this pair has a low correlation effect on the movement of other currency indices. This Pair, often referred to as a technical pair, where technical analysis will make you reap the benefits quite easily from this pair.
Factors affecting the volatility of pair GBPUSD:
Monetary and financial policies issued by the Bank of England;
Economic news that has a strong influence on the UK, such as the economic reports in the Industry sector and the report on the number of unemployed, as well as inflation data and figures;
News about Brexit, or political conditions that have an impact on the UK economy;
The interest rate is released by the Bank of England.
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