GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Oversold Condition: RSI at 26 suggests potential for a technical rebound.
- Resistance Levels: Key resistance at $1.28321 and $1.28694 limits upside.
- Buy Signal: Potential buy entry above $1.27201, targeting $1.27858.
The GBP/USD pair is trading at $1.27385, down 0.07% on the day, indicating a slight bearish tilt as the British pound remains under pressure against the U.S. dollar.
The pivot point for GBP/USD is at $1.27823, a critical level for gauging market direction in the near term. A sustained move above this point could signal a bullish shift, though immediate resistance at $1.28321 and further resistance at $1.28694 may limit any substantial recovery.
On the downside, immediate support sits at $1.27201, followed by stronger support levels at $1.26869 and $1.26529. A breach below these levels could accelerate bearish momentum, especially if the dollar continues to strengthen.
The Relative Strength Index (RSI) currently stands at 26, indicating an oversold condition and suggesting potential for a technical rebound if support holds. However, the 50-day Exponential Moving Average (EMA) at $1.28799 is notably above the current price, reinforcing the pair’s bearish bias. Traders may interpret this distance from the 50 EMA as a sign of sustained downward pressure unless a significant recovery occurs.
With GBP/USD hovering near oversold territory, a potential buy entry above $1.27201 may provide an opportunity for a short-term rebound, targeting $1.27858. A stop-loss at $1.26811 is advisable to manage risk, given the current bearish sentiment.
GBP/USD - Trade Ideas
Entry Price – Buy Above 1.27201
Take Profit – 1.27858
Stop Loss – 1.26811
Risk to Reward – 1: 1.6
Profit & Loss Per Standard Lot = +$657/ -$390
Profit & Loss Per Mini Lot = +$65/ -$39
GBP/USD Price Analysis – Nov 13, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair extended its downward trend, despite mild declines in the US dollar. Currently, the pair is trading around the 1.2740 level, having dipped to an intraday low of 1.2729.
However, this downward pressure was driven by investor cautious sentiment ahead of the release of the US Consumer Price Index (CPI) data for October, scheduled for 13:30 GMT.
Furthermore, the disappointing UK labor market figures for the three months ending in September showed an unexpected rise in the unemployment rate to 4.3%. Meanwhile, the fresh payrolls were much lower than expected, with only 219K jobs added, compared to the 373K increase in the previous period ending in August. This was seen as another key factor that kept the GBP/USD pair down.
GBP/USD Pressure Mounts Amid Weak UK Labor Market Data and Inflation Concerns
On the data front, the United Kingdom (UK) labor market data for the three months ending in September showed that the unemployment rate rose to 4.3%, higher than expected. This caused the Pound to drop sharply.
Moreover, the number of new jobs added was lower than anticipated, with only 219K compared to 373K in the previous three-month period. Analysts at XTB suggest that the rise in unemployment could lead the market to expect a higher chance of a rate cut by the Bank of England (BoE) next month.
Although the labor market data wasn't all negative for the Pound, average earnings, which reflect wage growth and are important for consumer spending, came in higher than expected. This helped ease some of the concerns. Following the data, Bank of England Chief Economist Huw Pill raised concerns about inflation remaining high.
He noted that pay growth is still strong, which, combined with the UK’s productivity outlook, makes it difficult to meet the BoE’s inflation target. Pill's comments suggest that the central bank remains cautious about inflation, even as other parts of the economy show signs of slowing down.
Therefore, the weak UK labor market data and concerns over inflation led to a decline in the GBP, putting pressure on the GBP/USD pair. The market's expectation of a potential rate cut from the Bank of England further weighed on the Pound.
US Dollar Holds Firm Ahead of CPI Data, Pressuring GBP/USD Pair
On the US front, the broad-based US dollar is losing some momentum but continues to hold onto gains, with the US Dollar Index (DXY) at around 106.00, its highest level in over six months. Investors are focused on the upcoming release of the US Consumer Price Index (CPI) data for October, scheduled for 13:30 GMT.
Economists expect the headline inflation to rise to 2.6% from 2.4% in September, while core CPI, which excludes food and energy prices, is predicted to increase by 3.3%. Monthly, the headline CPI is expected to rise by 0.2%, and core CPI by 0.3%.
Although inflation is expected to show a slight increase, it likely won’t change the market’s view on the Federal Reserve’s (Fed) policy for December unless the numbers are significantly different from expectations. Most Fed officials are confident that inflation is moving towards their 2% target.
However, Minneapolis Fed President Neel Kashkari mentioned that if inflation rises unexpectedly before December, it could cause the Fed to reconsider its approach. The probability of the Fed reducing interest rates in December is now 62%, slightly lower than the 70% probability seen a week ago, according to the CME FedWatch tool.
Therefore, the US dollar’s steady strength, coupled with expectations for slightly higher inflation, is likely to keep pressure on the GBP/USD pair. If the CPI data aligns with expectations, it may reinforce the US dollar's dominance, limiting any potential recovery for the Pound.
GBP/USD – Technical Analysis
The GBP/USD pair is trading at $1.27385, down 0.07% on the day, indicating a slight bearish tilt as the British pound remains under pressure against the U.S. dollar.
The pivot point for GBP/USD is at $1.27823, a critical level for gauging market direction in the near term. A sustained move above this point could signal a bullish shift, though immediate resistance at $1.28321 and further resistance at $1.28694 may limit any substantial recovery.
On the downside, immediate support sits at $1.27201, followed by stronger support levels at $1.26869 and $1.26529. A breach below these levels could accelerate bearish momentum, especially if the dollar continues to strengthen.
The Relative Strength Index (RSI) currently stands at 26, indicating an oversold condition and suggesting potential for a technical rebound if support holds. However, the 50-day Exponential Moving Average (EMA) at $1.28799 is notably above the current price, reinforcing the pair’s bearish bias. Traders may interpret this distance from the 50 EMA as a sign of sustained downward pressure unless a significant recovery occurs.
With GBP/USD hovering near oversold territory, a potential buy entry above $1.27201 may provide an opportunity for a short-term rebound, targeting $1.27858. A stop-loss at $1.26811 is advisable to manage risk, given the current bearish sentiment.
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- GBP/USD faces resistance at the 50 EMA, around $1.2944.
- RSI at 41 indicates potential room for further downside.
- A short entry is favored below $1.2944, targeting $1.2928.
The British pound (GBP/USD) is trading slightly higher at $1.2909, marking a modest 0.05% gain on the day. The currency pair’s price action has remained confined within a tight range, with immediate technical levels providing both resistance and support.
The pivot point is positioned at $1.2925, offering a key reference for potential price fluctuations. GBP/USD faces immediate resistance at $1.2949, just above the 50-day Exponential Moving Average (EMA) at $1.2944. This EMA level serves as a significant resistance point, and a failure to breach it may keep the pound under pressure.
Further resistance is seen at $1.2974, with additional upside capped by the next key level at $1.3007. On the downside, immediate support lies at $1.2893. If bearish sentiment increases, the pair could test the next support at $1.2865, with a further drop potentially extending to $1.2834.
Technical indicators suggest a neutral to slightly bearish outlook. The Relative Strength Index (RSI) is at 41, indicating that there is still room for the pound to decline before reaching oversold levels. The 50 EMA at $1.2944 represents a critical threshold, and a close below this level would reinforce the bearish bias.
Traders may consider a potential short entry below $1.2944, targeting a take-profit level at $1.2928 and setting a stop-loss above the $1.2949 resistance
GBP/USD - Trade Ideas
Entry Price – Sell Below 1.29242
Take Profit – 1.28724
Stop Loss – 1.29501
Risk to Reward – 1: 2
Profit & Loss Per Standard Lot = +$518/ -$259
Profit & Loss Per Mini Lot = +$51/ -$25
GBP/USD Price Analysis – Nov 11, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair extended its early-day losing streak, remaining under pressure around the 1.2896 level and reaching an intraday low of 1.2888. However, the US dollar bullish rally was a key factor behind this bearish trend, along with uncertainty and cautious sentiment ahead of this week’s UK and US macroeconomic releases, which further weighed on the GBP/USD pair.
However, the Bank of England's hawkish stance provided some support for the GBP, limiting further losses in the GBP/USD pair. Moreover, the risk-on mood capped gains for the safe-haven US dollar, offering some support to GBP/USD. Despite these supportive factors, the strength of the US dollar dominated, putting pressure on the GBP/USD pair.
BoE's Hawkish Stance and Economic Data Awaited as GBP/USD Remains Cautious
On the GBP front, the Bank of England (BoE) has taken a hawkish stance, especially after warning that Chancellor Rachel Reeves’ expansive Autumn Budget could drive inflation higher. This cautious sentiment suggests the BoE may avoid cutting interest rates in 2025.
Meanwhile, the current positive market mood limits gains for the safe-haven US dollar, offering some support to the GBP/USD pair and encouraging caution before placing strong bearish trades.
Investors appear hesitant, likely staying on the sidelines as they await major economic data from both the UK and the US. However, the major UK data this week includes job market figures on Tuesday and preliminary Q3 GDP data on Friday.
Meanwhile, the US is set to release its Consumer Price Index (CPI) on Wednesday, followed by the Producer Price Index (PPI) on Thursday and Retail Sales data on Friday.
Therefore, the combination of the BoE's hawkish stance and key economic data releases from both the UK and the US creates uncertainty, limiting significant movement in the GBP/USD pair. Investors are likely to remain cautious, awaiting clearer direction.
US Dollar's Bullish Momentum Limits GBP/USD Gains Amid Inflation Concerns and Economic Data
On the US front, the broad-based US dollar maintained its bullish momentum, holding near recent highs amid expectations that President-elect Donald Trump’s policies could increase inflation. This anticipated inflation rise may limit the Federal Reserve's ability to cut interest rates aggressively.
Federal Reserve officials, including Minneapolis Fed President Neel Kashkari, highlighted the economy's resilience, noting that more evidence is needed to confirm inflation’s return to the 2% target.
Although some suggest Trump’s fiscal policies could lead to more spending and labor demand, potentially strengthening the dollar, Fed Chair Jerome Powell emphasized that the Fed will remain data-driven and not speculate on future policy changes.
Meanwhile, economic data continues to show a solid US economy. On the data front, the preliminary University of Michigan Consumer Sentiment Index rose to 73.0 in November, signaling consumer optimism, while weekly jobless claims slightly increased but stayed close to expectations.
Therefore, the US dollar's strength, driven by expectations of rising inflation and limited rate cuts, is putting downward pressure on the GBP/USD pair. Despite the Bank of England's hawkish stance, the USD's bullish trend limits any significant gains for GBP/USD.
GBP/USD – Technical Analysis
The British pound (GBP/USD) is trading slightly higher at $1.2909, marking a modest 0.05% gain on the day. The currency pair’s price action has remained confined within a tight range, with immediate technical levels providing both resistance and support.
The pivot point is positioned at $1.2925, offering a key reference for potential price fluctuations. GBP/USD faces immediate resistance at $1.2949, just above the 50-day Exponential Moving Average (EMA) at $1.2944. This EMA level serves as a significant resistance point, and a failure to breach it may keep the pound under pressure.
Further resistance is seen at $1.2974, with additional upside capped by the next key level at $1.3007. On the downside, immediate support lies at $1.2893. If bearish sentiment increases, the pair could test the next support at $1.2865, with a further drop potentially extending to $1.2834.
Technical indicators suggest a neutral to slightly bearish outlook. The Relative Strength Index (RSI) is at 41, indicating that there is still room for the pound to decline before reaching oversold levels. The 50 EMA at $1.2944 represents a critical threshold, and a close below this level would reinforce the bearish bias.
Traders may consider a potential short entry below $1.2944, targeting a take-profit level at $1.2928 and setting a stop-loss above the $1.2949 resistance
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Entry Strategy: Consider selling below $1.29118, targeting $1.28273, with a stop loss at $1.29526.
- Immediate Support: Key support at $1.28134; further downside risk if this level fails.
- Technical Indicators: RSI at 31 indicates potential for a minor bounce, but overall trend remains bearish.
The British pound is under pressure against the U.S. dollar, with GBP/USD dropping to $1.28510, reflecting a 1.45% decline on the day. The pair has slipped below key support levels, signaling a bearish outlook as the dollar strengthens.
The immediate support now stands at $1.28134, with further downside targets at $1.27817 if selling momentum continues. On the upside, resistance sits at $1.29125, with additional resistance levels at $1.29524 (pivot) and $1.29950. A break above these levels would be necessary to ease the bearish tone, though current indicators suggest that the pound is likely to remain under pressure in the near term.
Technical indicators paint a bearish picture, with the 50-day EMA positioned at $1.29512, well above the current price. This moving average underscores the downward trend and suggests limited upside potential for the pound unless it can reclaim levels above $1.29524.
The RSI stands at 31, edging close to oversold territory. Although this level could suggest a short-term bounce, the broader trend remains bearish, particularly as dollar strength persists.
For traders, a short position below the pivot of $1.29118 may be prudent, with a take-profit target near $1.28273 and a stop loss at $1.29526. With the pound struggling to find traction, maintaining positions below key levels aligns with current market sentiment.
GBP/USD - Trade Ideas
Entry Price – Sell Below 1.29118
Take Profit – 1.28273
Stop Loss – 1.29526
Risk to Reward – 1: 2
Profit & Loss Per Standard Lot = +$845/ -$408
Profit & Loss Per Mini Lot = +$84/ -$40
GBP/USD Price Analysis – Nov 06, 2024
Daily Price Outlook
During Asian trading hours on Wednesday, the GBP/USD pair continued its downward trend, turning bearish at the 1.2889 level and reaching an intra-day low of 1.2846. This depreciation was mainly driven by a surge in the US Dollar after Donald Trump claimed victory in the 2024 presidential election, with Republicans poised to take control of both the Senate and the House.
On the GBP front, the Bank of England’s upcoming rate decision, scheduled for Thursday, is expected to result in a quarter-point reduction. The BoE’s Monetary Policy Committee is likely to vote 7-2 in favor of lowering the main reference rate to 4.75% from the current 5.0%. As a result, the anticipated rate cut is expected to weigh on the GBP, as lower interest rates generally reduce the currency’s appeal to investors.
Trump’s Victory and Fed Rate Cut Expectations Drive Bearish Momentum in GBP/USD
On the US front, the broad-based US dollar sustained its upward trend and gained further momentum after Donald Trump claimed victory in the 2024 presidential election. Although the election is not officially decided yet, Trump declared himself the winner, stating that his victory gives him a strong mandate to push forward his economic policies.
Trump won key battleground states like North Carolina, Georgia, and Pennsylvania, and Fox News has already called him the winner over Democrat Kamala Harris.
Alongside Trump's win, the Republican Party is also set to take control of the Senate and is likely to win the House of Representatives.
This Republican sweep in Congress will make it easier for Trump to implement his policies, which are expected to be more inflationary, especially given his protectionist stance on trade and immigration.
The US dollar and Treasury yields surged on the news of Trump’s victory, with the greenback reaching a near four-month high.
However, the quick conclusion to the election also reduces uncertainty in the stock market, which had faced turmoil following the 2020 election.
Meanwhile, traders are awaiting the Federal Reserve’s decision on interest rates, with strong expectations for a 25 basis point cut on Thursday.
Therefore, the US dollar's strength, driven by Trump's victory and Republican control, likely pressures the GBP/USD pair, as the greenback gains momentum. Additionally, expectations of a Fed rate cut add further downward pressure on the GBP, amplifying the pair’s bearish trend.
GBP/USD – Technical Analysis
The British pound is under pressure against the U.S. dollar, with GBP/USD dropping to $1.28510, reflecting a 1.45% decline on the day. The pair has slipped below key support levels, signaling a bearish outlook as the dollar strengthens.
The immediate support now stands at $1.28134, with further downside targets at $1.27817 if selling momentum continues. On the upside, resistance sits at $1.29125, with additional resistance levels at $1.29524 (pivot) and $1.29950.
A break above these levels would be necessary to ease the bearish tone, though current indicators suggest that the pound is likely to remain under pressure in the near term.
Technical indicators paint a bearish picture, with the 50-day EMA positioned at $1.29512, well above the current price. This moving average underscores the downward trend and suggests limited upside potential for the pound unless it can reclaim levels above $1.29524.
The RSI stands at 31, edging close to oversold territory. Although this level could suggest a short-term bounce, the broader trend remains bearish, particularly as dollar strength persists.
For traders, a short position below the pivot of $1.29118 may be prudent, with a take-profit target near $1.28273 and a stop loss at $1.29526. With the pound struggling to find traction, maintaining positions below key levels aligns with current market sentiment.
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Pivot Sensitivity: GBP/USD’s pivot at $1.29954 is critical; a break below may signal bearish momentum.
- Overbought Warning: RSI at 64 suggests limited upside as the pair nears overbought territory.
- Resistance Challenge: Key resistance levels at $1.30108 and above could determine further bullish potential.
The GBP/USD pair is trading at $1.29868, up 0.56% for the day, as it hovers around a key pivot level at $1.29954. This pivot point will be critical in determining the pair’s next move. Immediate resistance is positioned at $1.30108, followed by further resistance at $1.30262 and a higher target at $1.30431.
A break above these levels could indicate renewed bullish momentum, particularly if GBP/USD sustains above the 50-day Exponential Moving Average (EMA) of $1.29315. With the Relative Strength Index (RSI) reading at 64, the pair is close to overbought territory, signaling that the upside may be limited unless there’s a decisive move past the resistance zone.
On the downside, immediate support lies at $1.29674, with additional layers at $1.29473 and $1.29274. Should the pair drop below $1.29674, selling pressure could increase, pushing GBP/USD toward the 50 EMA, which acts as a significant support barrier. Market sentiment is closely tied to ongoing dollar strength and investor sentiment around the Bank of England’s interest rate outlook, which could influence GBP demand.
For traders, a breach below the pivot at $1.29954 could trigger selling interest, targeting $1.29531. However, a sustained push above $1.30108 would shift the outlook to bullish, with $1.30431 as an upper target in the short term.
GBP/USD - Trade Ideas
Entry Price – Sell Below 1.29951
Take Profit – 1.29531
Stop Loss – 1.30263
Risk to Reward – 1: 1.3
Profit & Loss Per Standard Lot = +$420/ -$312
Profit & Loss Per Mini Lot = +$42/ -$31
GBP/USD Price Analysis – Nov 04, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair maintained its upward trend and remained well-bid around the 1.2961 level and reaching an intraday high of 1.2999. However, the upward trend can be attributed to the US Dollar's strong decline ahead of the upcoming presidential election on Tuesday.
As a result, the Pound Sterling is gaining strength against the Dollar and other major currencies. Investors are also focused on the Bank of England’s monetary policy decision expected on Thursday, which could further impact the cable pair performance.
US Dollar Weakness and Its Impact on GBP/USD Exchange Rate
On the US front, the broad-based US dollar failed to sustain its bullish trend and turned bearish on Monday as the US Dollar Index (DXY) dropped to around 103.60, its lowest level in almost two weeks.
However, this decline was triggered by a recent poll from the Des Moines Register/Mediacom Iowa Poll, which showed Democratic candidate Kamala Harris gaining three points over former President Donald Trump in Iowa. Many national polls indicate a close race between the two candidates, creating uncertainty in the market.
Besides the election, investors are also looking to the Federal Reserve’s (Fed) policy announcement on Thursday. The Fed is expected to cut interest rates again, but this time by a smaller amount of 25 basis points, following a larger cut of 50 basis points in September. Investors will be particularly attentive to the Fed’s comments about future rate decisions, especially for the December meeting.
Therefore, the bearish trend of the US dollar could strengthen the GBP/USD pair as the Pound gains against a weakening Greenback. Meanwhile, uncertainty surrounding the election and potential Fed rate cuts may further support the Pound’s upward momentum against the Dollar.
Impact of Bank of England's Monetary Policy on GBP/USD Pair
On the GBP front, the upticks in the GBP/USD pair could be further boosted by the Bank of England's (BoE) monetary policy decision expected on Thursday. However, the BoE is anticipated to cut interest rates by 25 basis points, bringing them down to 4.75%.
Notably, Monetary Policy Committee (MPC) members are mostly in favor of a rate cut, with seven expected to support it, while two, including external member Catherine Mann, prefer maintaining rates at 5%.
Investors will closely watch BoE Governor Andrew Bailey’s press conference following the policy decision for insights into future actions, especially for December.
Moreover, UK Chancellor of the Exchequer recently announced £40 billion in new taxes, the highest since 1993, along with various investment projects aimed at boosting public spending. The Office for Business Responsibility (OBR) has also raised current-year inflation targets to 2.5% from the previous 2.2%.
Therefore, the anticipated rate cut by the Bank of England could strengthen the GBP/USD pair, as a lower interest rate may encourage investment in the Pound. However, the uncertainty around inflation targets and government policies could also create volatility in the exchange rate.
GBP/USD – Technical Analysis
The GBP/USD pair is trading at $1.29868, up 0.56% for the day, as it hovers around a key pivot level at $1.29954. This pivot point will be critical in determining the pair’s next move. Immediate resistance is positioned at $1.30108, followed by further resistance at $1.30262 and a higher target at $1.30431.
A break above these levels could indicate renewed bullish momentum, particularly if GBP/USD sustains above the 50-day Exponential Moving Average (EMA) of $1.29315. With the Relative Strength Index (RSI) reading at 64, the pair is close to overbought territory, signaling that the upside may be limited unless there’s a decisive move past the resistance zone.
On the downside, immediate support lies at $1.29674, with additional layers at $1.29473 and $1.29274. Should the pair drop below $1.29674, selling pressure could increase, pushing GBP/USD toward the 50 EMA, which acts as a significant support barrier.
Market sentiment is closely tied to ongoing dollar strength and investor sentiment around the Bank of England’s interest rate outlook, which could influence GBP demand.
For traders, a breach below the pivot at $1.29954 could trigger selling interest, targeting $1.29531. However, a sustained push above $1.30108 would shift the outlook to bullish, with $1.30431 as an upper target in the short term.
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GBP/USD Price Analysis – Oct 30, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair continued its downward trend, trading sluggish around the 1.2976 level on Wednesday. This is because traders are watching closely for the United Kingdom's Autumn Forecast Statement, set to be announced at 12:45 GMT.
This marks Labour's first budget presentation in over 15 years, with Chancellor of the Exchequer Rachel Reeves expected to propose tax increases on various income sources and outline plans for higher spending to boost investment.
This could undermine the GBP as investors react negatively to such measures, fearing they could lead to slower economic growth or increased debt levels. This could contribute to further weakness in the GBP/USD pair
On the flip side, the losses in the GBP/USD pair may ease as the US dollar weakens ahead of important US economic data. The ADP Employment Change report for October and the Q3 flash GDP data will be released around 12:30 GMT, which could further impact the currency pair.
US Economic Data and Its Impact on GBP/USD Pair
On the US front, the broad-based US dollar turned bearish ahead of important economic data. As a result, the GBP/USD pair gained slightly, with investors focused on the upcoming ADP Employment Change report for October.
This report is expected to show that the private sector added 115,000 new jobs, down from 143,000 in September. However, the slowdown in job growth could worry investors about the job market, leading to increased expectations for interest rate cuts by the Federal Reserve.
Meanwhile, Tuesday’s JOLTS Job Openings data for September raised concerns about slowing job demand, as the number of new job openings was lower than expected. Investors are also looking ahead to the US Nonfarm Payrolls (NFP) data for October, which will be released on Friday, to gain more insights into the labor market.
Hence, the US economy is expected to grow steadily at a rate of 3.0% in the third quarter of the year, showing some resilience despite challenges in the job market.
Impact of UK Autumn Forecast Statement on GBP/USD Pair
Moreover, many investors are cautious about making strong moves ahead of the United Kingdom's Autumn Forecast Statement, which will be announced at 12:45 GMT.
This will be Labour’s first budget presentation in over 15 years. Chancellor of the Exchequer Rachel Reeves is expected to announce tax hikes on various income sources and outline plans for increased spending to boost investment.
According to UBS, the budget will focus on three main areas: changes to fiscal rules to allow more borrowing, a package of tax increases on capital gains, inheritance, pensions, and national insurance contributions for employers, and additional spending on investment projects.
Market participants are particularly interested in the details of the tax increases and spending plans, as these could affect inflation. Analysts at UBS believe that higher spending will likely raise the fiscal deficit to 3.1% of GDP.
This higher deficit could raise concerns about ongoing price pressures, leading traders to reconsider their expectations for the Bank of England’s (BoE) interest rate decisions for the rest of the year.
According to a recent Reuters poll, the BoE is expected to cut interest rates by 25 basis points in its upcoming meeting on November 7, bringing key borrowing rates down to 4.75%.
Therefore, the cautious investor sentiment and potential tax hikes in the UK may weaken the GBP/USD pair, as concerns over higher fiscal deficits could dampen confidence in the pound, especially if the Bank of England cuts interest rates as expected.
GBP/USD – Technical Analysis
GBP/USD is trading near the $1.29990 level, showing a slight decline and hovering just below the key pivot point at $1.30154. Immediate resistance lies at $1.30312, followed by stronger resistance at $1.30493 and $1.30644.
The Relative Strength Index (RSI) stands at 56, hinting at moderate bullish momentum but not yet in overbought territory. Additionally, the 50-day Exponential Moving Average (EMA) is positioned at $1.29753, offering a nearby support level that could reinforce bullish sentiment if tested.
A sustained move above the $1.30154 pivot could spark buying interest, potentially driving the pair toward $1.30493 and beyond. However, if prices fall below immediate support at $1.29947, traders may see further downside risk toward $1.29793 and $1.29587.
For those seeking a buying opportunity, an entry above $1.29895 with a target at $1.30320 and a stop loss near $1.29562 aligns with the current technical setup, balancing risk with potential upside. GBP/USD is positioned near its pivot with a mildly bullish outlook, with buyers likely stepping in above $1.30154.
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Insight: GBP/USD tests key pivot level, signaling potential upside above $1.30154.
- Key Levels: Immediate resistance at $1.30312; immediate support at $1.29947.
- Outlook: Mildly bullish if prices can hold above pivot point, with buying interest likely above $1.30154.
GBP/USD is trading near the $1.29990 level, showing a slight decline and hovering just below the key pivot point at $1.30154. Immediate resistance lies at $1.30312, followed by stronger resistance at $1.30493 and $1.30644.
The Relative Strength Index (RSI) stands at 56, hinting at moderate bullish momentum but not yet in overbought territory. Additionally, the 50-day Exponential Moving Average (EMA) is positioned at $1.29753, offering a nearby support level that could reinforce bullish sentiment if tested.
A sustained move above the $1.30154 pivot could spark buying interest, potentially driving the pair toward $1.30493 and beyond. However, if prices fall below immediate support at $1.29947, traders may see further downside risk toward $1.29793 and $1.29587.
For those seeking a buying opportunity, an entry above $1.29895 with a target at $1.30320 and a stop loss near $1.29562 aligns with the current technical setup, balancing risk with potential upside. GBP/USD is positioned near its pivot with a mildly bullish outlook, with buyers likely stepping in above $1.30154.
GBP/USD - Trade Ideas
Entry Price – Buy Above 1.29895
Take Profit – 1.30320
Stop Loss – 1.29562
Risk to Reward – 1: 1.2
Profit & Loss Per Standard Lot = +$425/ -$333
Profit & Loss Per Mini Lot = +$42/ -$33