GBP/USD Price Analysis – Dec 23, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair started the week on a quiet note, moving in a narrow range just above the mid-1.2500s.
However, the US Dollar had pulled back from a two-year high last Friday, following the release of the Personal Consumption Expenditure (PCE) Price Index for November. The report showed signs of inflation easing, but also highlighted ongoing economic struggles.
However, there are still factors working in favor of the USD. The Federal Reserve's recent hawkish stance continues to support the greenback, as markets anticipate further tightening. This keeps the safe-haven USD in demand, limiting any significant gains for the GBP.
On the other hand, the British Pound faces its own challenges. The Bank of England's (BoE) recent decision to leave interest rates unchanged, along with a more dovish outlook, has created a sense of caution in the markets.
The BoE’s split vote shows a lack of consensus among policymakers, which leaves traders hesitant to make aggressive bullish bets on the GBP.
As a result, the pair's movement remains restrained, with neither the USD nor GBP dominating the direction in the early hours of the week.
USD Remains Supported by Hawkish Fed and Global Tensions, Capping GBP/USD Gains
On the US front, the broad-based US Dollar (USD) eased from its two-year high on Friday after the November Personal Consumption Expenditure (PCE) Price Index hinted at slowing inflation and ongoing economic challenges.
This has kept USD buyers cautious, giving some support to the GBP/USD pair. However, the Federal Reserve’s (Fed) hawkish outlook still favors the USD.
While the Fed recently lowered interest rates by 25 basis points (bps), it signaled a slower pace of rate cuts in 2025.
This, along with strong US Treasury yields and global tensions from the Russia-Ukraine conflict and Middle East unrest, could attract USD buyers and limit the GBP/USD pair's gains.
Traders now await key events for further direction, including the Bank of England’s (BoE) Quarterly Bulletin and the US Consumer Confidence Index later today.
The market mood remains cautious, as the BoE’s less aggressive stance on interest rates and global uncertainties weigh on the British Pound.
Given the mixed signals from both currencies, it’s wise to wait for clear and sustained buying interest before confirming whether the GBP/USD pair has hit a bottom in the short term.
GBP/USD Under Pressure Amid BoE's Dovish Tone and Economic Downgrade
On the GBP front, the British Pound faces pressure after the Bank of England (BoE) decided to keep interest rates unchanged last week.
The decision revealed a split vote among policymakers, with three members of the Monetary Policy Committee (MPC) voting to cut rates. This lack of agreement has added to the uncertainty surrounding the BoE's future policy direction.
Moreover, the central bank downgraded its economic forecast for the final quarter of 2024, signaling potential challenges ahead for the UK economy.
These developments make traders cautious about betting on strong gains for the GBP. The BoE's dovish tone, combined with concerns about slower growth, is likely to limit the upside for the GBP/USD pair.
This cautious outlook keeps the GBP/USD pair under pressure, with further movements likely dependent on broader market factors and key economic data.
GBP/USD – Technical Analysis
GBP/USD is trading at $1.25689, up 0.04%, as the pair consolidates below the $1.26021 pivot point, reflecting a cautious tone.
The pair faces immediate resistance at $1.26620, with higher barriers at $1.27292 and $1.27819, signaling a challenging path for bulls amid a neutral market sentiment.
The 50 EMA at $1.26110 hovers above the current price, adding to downward pressure, while the RSI at 50 highlights indecision in momentum.
On the downside, immediate support lies at $1.25375, with additional levels at $1.24764 and $1.24237, reinforcing a bearish bias if these levels are breached.
The broader trend remains under pressure as the pair struggles to maintain gains above the pivot. The technical setup favors sellers, with the current price action suggesting a potential downside toward the $1.25029 take-profit target, especially if the pair fails to overcome the $1.26021 pivot point.
However, a decisive break above $1.26620 could shift momentum, opening the door to further gains.
Sell-limit orders below $1.25819 are preferred, with a target of $1.25029 and a stop-loss at $1.26415. Key resistance above $1.26620 needs monitoring for a potential reversal.
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Immediate Resistance: $1.26620; Next: $1.27292, $1.27819.
- Immediate Support: $1.25375; Next: $1.24764, $1.24237.
- RSI at 50 and 50 EMA at $1.26110 suggest a neutral to bearish outlook.
GBP/USD is trading at $1.25689, up 0.04%, as the pair consolidates below the $1.26021 pivot point, reflecting a cautious tone.
The pair faces immediate resistance at $1.26620, with higher barriers at $1.27292 and $1.27819, signaling a challenging path for bulls amid a neutral market sentiment.
The 50 EMA at $1.26110 hovers above the current price, adding to downward pressure, while the RSI at 50 highlights indecision in momentum.
On the downside, immediate support lies at $1.25375, with additional levels at $1.24764 and $1.24237, reinforcing a bearish bias if these levels are breached.
The broader trend remains under pressure as the pair struggles to maintain gains above the pivot. The technical setup favors sellers, with the current price action suggesting a potential downside toward the $1.25029 take-profit target, especially if the pair fails to overcome the $1.26021 pivot point.
However, a decisive break above $1.26620 could shift momentum, opening the door to further gains.
Sell-limit orders below $1.25819 are preferred, with a target of $1.25029 and a stop-loss at $1.26415. Key resistance above $1.26620 needs monitoring for a potential reversal.
GBP/USD - Trade Ideas
Entry Price – Sell Limit 1.25819
Take Profit – 1.25029
Stop Loss – 1.26415
Risk to Reward – 1: 1.3
Profit & Loss Per Standard Lot = +$790/ -$596
Profit & Loss Per Mini Lot = +$79/ -$59
GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- GBP/USD trades at $1.27014, below the $1.27860 pivot, signaling short-term bearish bias.
- Resistance stands at $1.28351, with key support at $1.26666.
- Sell limit at $1.27217 targets $1.26588, with a stop at $1.27678.
The GBP/USD pair is trading at $1.27014, down 0.05%, reflecting a cautious sentiment as the pair remains near a key support level.
The pivot point at $1.27860 acts as a critical resistance, with the pair trading just below the 50 EMA at $1.27176, reinforcing a short-term bearish bias.
Immediate resistance lies at $1.28351, followed by $1.28742, levels that need to be breached to signal a shift in sentiment.
On the downside, the pair finds immediate support at $1.26666, with further levels at $1.26070 and $1.25636 providing key targets for bearish momentum. The RSI at 51 signals neutrality, suggesting limited immediate momentum but leaving room for directional movement.
Traders are positioning for a Sell Limit at $1.27217, targeting $1.26588, with a stop loss at $1.27678 to manage upside risks.
For now, GBP/USD remains rangebound, with a bearish outlook prevailing unless the price reclaims the pivot point and surpasses the 50 EMA.
A failure to hold support at $1.26666 could open the door for further declines toward $1.26070.
The pair’s direction hinges on a break above resistance or below key support, with the overall sentiment skewed slightly bearish.
GBP/USD - Trade Ideas
Entry Price – Sell Limit 1.27217
Take Profit – 1.26588
Stop Loss – 1.27678
Risk to Reward – 1: 1.3
Profit & Loss Per Standard Lot = +$629/ -$461
Profit & Loss Per Mini Lot = +$62/ -$46
GBP/USD Price Analysis – Dec 18, 2024
Daily Price Outlook
During the European trading session on Wednesday, the GBP/USD currency pair continued its bearish trend, struggling to maintain any upward momentum.
The pair hovered around the 1.2689 level and hit an intra-day low of 1.2679. This decline can largely be attributed to the release of the UK Consumer Price Index (CPI) data for November, which showed that inflation pressures had risen as expected. This data kept the Pound under pressure as traders assessed the UK’s inflation outlook.
Meanwhile, the US Dollar remained stable as market participants awaited the Federal Reserve’s upcoming monetary policy announcement.
Meanwhile, the expectations for a 25-basis point interest rate cut could cap gains in the US dollar and may help GBP/USD pair to limit its losses.
Impact of Federal Reserve's Rate Cut and Inflation Concerns on GBP/USD
On the US front, the US Dollar has been gaining momentum as markets focus on the Federal Reserve's upcoming monetary policy announcement, scheduled for 19:00 GMT.
Traders are anticipating a 25-basis point interest rate cut, which would mark the third consecutive reduction by the Fed.
Investors are closely monitoring the Federal Open Market Committee's (FOMC) Economic Projections and the dot plot, which provides the Fed’s outlook on interest rates for the coming years.
Most economists expect the Fed to slow down its rate cuts in 2025. According to a recent Bloomberg survey, while the Fed may reduce rates three times next year, inflation is likely to remain above the Fed's target.
Additionally, economists are growing more concerned about inflation risks due to the policies of President-elect Donald Trump, including higher import tariffs, tax cuts, and potential mass deportations. These factors could create more uncertainty in the economy and financial markets.
Impact of UK Inflation Data and Bank of England's Rate Outlook on GBP/USD
On the GBP front, the Pound Sterling showed some volatility on Wednesday after the release of the UK Consumer Price Index (CPI) data for November.
The report revealed that inflation rose as expected, with the annual inflation rate increasing to 2.6% from 2.3% in October. Monthly inflation rose by 0.1%, which was lower than the previous month's 0.6%.
The core CPI, which excludes items like food and energy, grew by 3.5%, slightly above the previous month's 3.3%, but below the expected 3.6%. Services inflation, an important indicator for the Bank of England (BoE), rose by 5%.
This rise in inflation has led many to expect the Bank of England (BoE) to keep interest rates at 4.75% in their upcoming meeting, with most members voting to keep rates unchanged.
However, one member, Swati Dhingra, is expected to call for a 25 basis point rate cut. Investors are closely watching BoE Governor Andrew Bailey’s press conference to see if the central bank plans to ease its policies further in 2025.
Additionally, retail sales data for November, set to be released on Friday, will also be important for understanding the UK's economic outlook.
Therefore, the rise in inflation and expectations for the Bank of England to keep rates unchanged may keep the GBP/USD pair under pressure. If the BoE signals further policy easing in 2025, it could weigh on the Pound, limiting upside potential.
The GBP/USD pair is trading at $1.27014, down 0.05%, reflecting a cautious sentiment as the pair remains near a key support level.
The pivot point at $1.27860 acts as a critical resistance, with the pair trading just below the 50 EMA at $1.27176, reinforcing a short-term bearish bias.
Immediate resistance lies at $1.28351, followed by $1.28742, levels that need to be breached to signal a shift in sentiment.
On the downside, the pair finds immediate support at $1.26666, with further levels at $1.26070 and $1.25636 providing key targets for bearish momentum. The RSI at 51 signals neutrality, suggesting limited immediate momentum but leaving room for directional movement.
Traders are positioning for a Sell Limit at $1.27217, targeting $1.26588, with a stop loss at $1.27678 to manage upside risks.
For now, GBP/USD remains rangebound, with a bearish outlook prevailing unless the price reclaims the pivot point and surpasses the 50 EMA.
A failure to hold support at $1.26666 could open the door for further declines toward $1.26070.
The pair’s direction hinges on a break above resistance or below key support, with the overall sentiment skewed slightly bearish.
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GBP/USD Price Analysis – Dec 16, 2024
Daily Price Outlook
During the European trading session, the GBP/USD pair climbed to around 1.2647, briefly reaching an intraday high of 1.2671.
This upward movement was driven by the release of the UK’s flash S&P Global/CIPS Purchasing Managers’ Index (PMI) data.
The report revealed that overall business activity in the UK expanded modestly, with the PMI rising to 50.5. Meanwhile, the US dollar weakened, turning bearish ahead of key monetary policy meetings this week.
Moving ahead, Federal Reserve is set to meet on Wednesday, followed by the Bank of England on Thursday, adding to market anticipation and influencing the currency pair's performance.
GBP/USD Volatility Set to Increase Ahead of Fed and BoE Meetings Amid Mixed UK PMI Data
On the BoE front, the release of the UK’s flash S&P Global/CIPS PMI data offered mixed signals. Overall business activity expanded at a steady pace, with the PMI rising to 50.5.
However, the manufacturing sector showed a faster-than-expected contraction, with its PMI dropping to 47.3 from 48.0 in November, against forecasts of 48.1.
On the other hand, the services sector grew more robustly, with its PMI climbing to 51.4, beating expectations of 51.0 and the previous month’s 50.8.
Despite this moderate growth, businesses remain cautious due to fragile consumer confidence, tighter budgets, and cutbacks in non-essential spending.
The report also revealed a decline in staffing for the third straight month, partly due to upcoming increases in National Insurance contributions.
Meanwhile, the Pound Sterling gained strength against the US Dollar, which remained subdued with the US Dollar Index (DXY) around 107.00.
Investors are bracing for volatility in the GBP/USD pair this week as both the Federal Reserve (Fed) and the Bank of England (BoE) are set for their final policy meetings of the year.
The Fed is expected to reduce interest rates by 25 basis points to 4.25%-4.50%, while the BoE is likely to keep its rates unchanged at 4.75%.
However, with these rate decisions largely priced in, market attention is shifting toward the outlook for 2025, where traders anticipate three rate cuts from both central banks.
In addition to the central bank meetings, UK economic data will also influence the Pound this week. Employment figures for the three months ending in October and the Consumer Price Index (CPI) data for November will be released on Tuesday and Wednesday.
Any significant deviation from expected numbers could influence market expectations for the BoE’s future actions and its policy stance for 2025.
(GBP/USD) – Technical Analysis
The GBP/USD pair is trading at $1.26392, up 0.24%, as buyers extend gains above the pivot point of $1.26160. The immediate resistance sits at $1.26725, where a break higher could open the door to further upside, targeting resistance levels at $1.27194 and $1.27860.
Market sentiment remains cautiously optimistic, with the pound benefiting from renewed risk appetite and technical buying momentum.
On the downside, immediate support is seen at $1.25679, followed by further levels at $1.25239 and $1.24866, which could attract dip-buyers if the pair retraces.
Despite the current uptick, the 50-day EMA at $1.27096 looms overhead as a key hurdle for bullish continuation, and any failure to breach this resistance could trigger a pullback.
The Relative Strength Index (RSI) stands at 40, signaling mild bearish pressure but also leaving room for a potential recovery.
The technical setup suggests cautious buying above the pivot point at $1.26160, with a target of $1.26742 and a stop loss at $1.25862 to manage downside risks.
In conclusion, the GBP/USD remains in a consolidative phase, but the short-term bias tilts bullish above $1.26160.
A sustained push above $1.26725 would reinforce upward momentum, while failure to hold the pivot could expose the pair to further selling pressure.
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Immediate Resistance: $1.26725; Next Levels: $1.27194 and $1.27860.
- Support Levels: $1.25679; Further Supports: $1.25239 and $1.24866.
- Indicators: RSI at 40 signals mild bearish pressure; 50 EMA at $1.27096 remains a key hurdle.
The GBP/USD pair is trading at $1.26392, up 0.24%, as buyers extend gains above the pivot point of $1.26160. The immediate resistance sits at $1.26725, where a break higher could open the door to further upside, targeting resistance levels at $1.27194 and $1.27860.
Market sentiment remains cautiously optimistic, with the pound benefiting from renewed risk appetite and technical buying momentum.
On the downside, immediate support is seen at $1.25679, followed by further levels at $1.25239 and $1.24866, which could attract dip-buyers if the pair retraces.
Despite the current uptick, the 50-day EMA at $1.27096 looms overhead as a key hurdle for bullish continuation, and any failure to breach this resistance could trigger a pullback.
The Relative Strength Index (RSI) stands at 40, signaling mild bearish pressure but also leaving room for a potential recovery.
The technical setup suggests cautious buying above the pivot point at $1.26160, with a target of $1.26742 and a stop loss at $1.25862 to manage downside risks.
In conclusion, the GBP/USD remains in a consolidative phase, but the short-term bias tilts bullish above $1.26160.
A sustained push above $1.26725 would reinforce upward momentum, while failure to hold the pivot could expose the pair to further selling pressure.
GBP/USD - Trade Ideas
Entry Price – Buy Limit 1.26158
Take Profit – 1.26742
Stop Loss – 1.25862
Risk to Reward – 1: 1.9
Profit & Loss Per Standard Lot = +$584/ -$296
Profit & Loss Per Mini Lot = +$58/ -$29
GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Bullish Momentum Intact: GBP/USD trades above the pivot at $1.27356, supported by the 50 EMA at $1.27529.
- Key Resistance at $1.27986: Breaking this level may trigger further gains toward $1.28322 and $1.28665.
- Strategic Buy-Limit Entry: Enter long at $1.27362, target $1.27979, with a stop-loss at $1.26958 for risk management.
The GBP/USD pair is trading at $1.27680, reflecting a 0.6% gain on the day and signaling moderate bullish momentum on the 4-hour chart. The pivot point at $1.27356 serves as a critical level, with prices attempting to hold above it.
Immediate resistance is situated at $1.27986, followed by $1.28322 and $1.28665. On the downside, immediate support lies at $1.26955, with additional support levels at $1.26546 and $1.26169.
Technical indicators provide mixed signals. The RSI is at 53, indicating a balanced market sentiment, neither overbought nor oversold. The 50 EMA, positioned at $1.27529, aligns with current price action, reinforcing the bullish bias as long as prices remain above this level.
A sustained move above $1.27986 could propel GBP/USD toward the next resistance at $1.28322, signaling continued buying interest.
Traders may consider a buy-limit strategy at $1.27362, targeting $1.27979, with a stop-loss at $1.26958. This approach capitalizes on the bullish trend while managing downside risk in the event of a reversal.
However, a break below the pivot point could invalidate this outlook, opening the door for further declines toward $1.26955 or lower support levels.
GBP/USD - Trade Ideas
Entry Price – Buy Limit 1.27362
Take Profit – 1.27979
Stop Loss – 1.26958
Risk to Reward – 1: 1.5
Profit & Loss Per Standard Lot = +$617/ -$404
Profit & Loss Per Mini Lot = +$61/ -$40
GBP/USD Price Analysis – Dec 11, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair struggled to halt its bearish trend and stayed under pressure around 1.2725, hitting an intraday low of 1.2713.
The decline was mainly driven by the stronger US Dollar, which gained support ahead of the release of the US Consumer Price Index (CPI) data for November, scheduled at 13:30 GMT.
Investors are keenly watching this report as it could influence expectations for the Federal Reserve’s future interest rate decisions.
Meanwhile, the British Pound faced additional challenges due to a lack of significant economic events in the UK. With a relatively quiet economic calendar, the focus has shifted to the Bank of England’s upcoming policy meeting on December 19.
Market participants are speculating on whether the BoE will maintain its current stance or take further action on interest rates.
Until then, the Pound is likely to remain under pressure, especially as it struggles to find clear direction against major currencies like the Euro and US Dollar.
US Dollar Strengthened by CPI Data and Fed Rate Cut Expectations, Impact on GBP/USD
On the US front, the broad-based US dollar maintained its upward trend as investors awaited the release of the November Consumer Price Index (CPI) data, scheduled for 13:30 GMT.
The inflation report is expected to show that the annual headline CPI increased slightly to 2.7% from the previous 2.6%.
The core CPI, which excludes food and energy prices, is forecasted to rise steadily by 3.3%. On a monthly basis, both the headline and core CPI are expected to grow by 0.3%.
This inflation data is unlikely to change the Federal Reserve's interest rate plans for the meeting on December 18, unless the numbers differ significantly from expectations.
According to a recent Reuters poll, 90% of economists believe the Fed will cut interest rates by 25 basis points next week.
The poll also suggests that most economists expect the Fed to pause any further rate cuts starting in January 2025, assuming that US President-elect Donald Trump's policies, such as higher import tariffs and tax cuts, could lead to higher inflation.
Therefore, the expected CPI data and the Fed's likely interest rate cut may support the US dollar, potentially keeping the GBP/USD pair under pressure. If inflation figures align with expectations, the pair could remain in a consolidative range until further clarity.
BoE Rate Decision and Economic Data to Drive Market Sentiment
On the GBP front, the Pound Sterling is struggling to find direction against other major currencies due to a quiet UK economic calendar.
As a result, the British currency's movement will largely depend on market expectations for the Bank of England’s (BoE) interest rate decision on December 19.
Traders expect the BoE to keep interest rates unchanged at 4.75% next week as inflationary pressures persist.
However, upcoming economic data, such as the UK’s employment report for the three months ending in October and the November Consumer Price Index (CPI), could influence the BoE's future rate decisions.
At the same time, concerns about the UK labor market could lead the BoE to adopt a more cautious stance.
A recent survey showed that employment growth expectations for the next year have dropped to a four-year low.
Later this week, investors will focus on the UK’s monthly Gross Domestic Product (GDP) and Industrial Production data for October.
These reports will provide a clearer picture of the UK economy’s health, with expectations of a recovery in both factory output and GDP after a decline in September. These indicators could further shape expectations for the BoE’s policy direction.
GBP/USD – Technical Analysis
The GBP/USD pair is trading at $1.27680, reflecting a 0.6% gain on the day and signaling moderate bullish momentum on the 4-hour chart. The pivot point at $1.27356 serves as a critical level, with prices attempting to hold above it.
Immediate resistance is situated at $1.27986, followed by $1.28322 and $1.28665. On the downside, immediate support lies at $1.26955, with additional support levels at $1.26546 and $1.26169.
Technical indicators provide mixed signals. The RSI is at 53, indicating a balanced market sentiment, neither overbought nor oversold. The 50 EMA, positioned at $1.27529, aligns with current price action, reinforcing the bullish bias as long as prices remain above this level.
A sustained move above $1.27986 could propel GBP/USD toward the next resistance at $1.28322, signaling continued buying interest.
Traders may consider a buy-limit strategy at $1.27362, targeting $1.27979, with a stop-loss at $1.26958. This approach capitalizes on the bullish trend while managing downside risk in the event of a reversal.
However, a break below the pivot point could invalidate this outlook, opening the door for further declines toward $1.26955 or lower support levels.
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GBP/USD Price Analysis – Dec 09, 2024
Daily Price Outlook
During the European trading session, the GBP/USD currency pair continued its upward movement, gaining momentum around the 1.2778 level and reaching an intraday high of 1.2784.
This bullish trend can largely be attributed to a weakening US dollar, which lost strength as investors grew more confident that the Federal Reserve would likely cut interest rates during its December 18 meeting.
At the same time, the GBP/USD pair benefited from expectations that the Bank of England will adopt a slower pace of policy easing due to ongoing concerns about persistent inflation pressures.
Looking ahead, all eyes are on the upcoming US Consumer Price Index (CPI) data for November, set to be released on Wednesday. Analysts expect headline CPI inflation to edge up to 2.7% from the previous 2.6%.
In the meantime, the core CPI, which excludes volatile food and energy prices, is forecast to remain steady at 3.3%. Investors are hoping these numbers will provide more insight into the current inflation situation.
US Dollar Weakened by Growing Fed Rate Cut Expectations, Boosting GBP/USD
On the US front, the broad-based US dollar has been under pressure as market participants grow increasingly confident that the Federal Reserve (Fed) will cut interest rates in its meeting on December 18.
There’s an 83% chance that the Fed will lower its key borrowing rate by 25 basis points to 4.25%-4.50% next week, according to the CME FedWatch tool. This is up from 62% a week ago, signaling rising expectations for a rate cut.
However, the speculation about the Fed’s rate cut strengthened after the release of the US Nonfarm Payrolls (NFP) data for November. The report showed the economy added 227,000 jobs, beating the 200,000 forecast.
However, the unemployment rate also rose slightly to 4.2%, as expected. Additionally, average hourly earnings grew by 0.4% month-over-month and 4% year-over-year, both higher than estimates, suggesting continued inflation pressures.
Despite this strong data, Federal Reserve Governor Michelle Bowman indicated on Friday that she would prefer a cautious and gradual approach to cutting rates, as inflation remains high.
This comment contrasts with the growing market expectation for rate cuts and highlights the ongoing debate within the Fed about the best approach to tackle inflation while supporting the economy.
Therefore, the growing expectation of a Fed rate cut has supported the GBP/USD pair, as the US dollar weakens. Investors anticipate that the Fed's actions could make the dollar less attractive, boosting the British pound's value against the Greenback.
GBP Strengthened by BoE’s Gradual Policy Easing, but Weakened by Declining UK Labor Demand
On the GBP front, the British pound is generally strong against its major counterparts, except for some Asia-Pacific currencies, as the Bank of England (BoE) is expected to take a more gradual approach to easing its monetary policy. This is due to concerns that inflationary pressures remain persistent.
BoE's Monetary Policy Committee (MPC) member Megan Greene mentioned that the bank could reach its inflation target by the end of its three-year forecast period.
BoE Governor Andrew Bailey also stated that while there’s still work to do to bring inflation down to the 2% target, the disinflation process is progressing well.
Investors are keeping a close eye on the BoE's next steps, especially with the upcoming speech by Deputy Governor Dave Ramsden, scheduled for 13:00 GMT on Monday.
Ramsden has been one of the BoE policymakers who has leaned towards reducing interest rates, which could influence market sentiment on the pound. His comments may provide more clarity on the BoE's stance regarding future rate cuts or increases.
On the economic front, a recent survey by the Recruitment and Employment Confederation (REC) and KPMG showed a decline in demand for workers in the UK.
This came after the government raised Employer’s National Insurance Contributions (NIC) to 15%. The survey revealed that demand for staff fell to its lowest level since August 2020, highlighting ongoing concerns in the labor market.
Thus, the British pound remains strong against the US dollar, supported by the Bank of England's cautious approach to monetary policy easing. However, the decline in UK labor demand could weigh on the pound, limiting further upside against the US dollar.
GBP/USD – Technical Analysis
GBP/USD is trading at $1.27340, down 0.03%, as the pair remains range-bound near the pivot point of $1.27551. The 50-day EMA at $1.27437 reflects slight bearish pressure as the price hovers just below this level, signaling caution among traders.
Immediate resistance is noted at $1.27957, with subsequent levels at $1.28367, suggesting that a recovery above the pivot could open the door for further gains.
On the downside, immediate support lies at $1.27171, with additional safety levels at $1.26875 and $1.26595. A break below $1.27171 could indicate further selling pressure, potentially driving the pair toward the $1.26298 zone.
The RSI at 45 signals neutral momentum, leaning slightly bearish but not yet oversold, leaving room for either direction depending on market catalysts.
A sustained break above $1.27551 would reinforce bullish momentum, targeting $1.27957 as the first resistance. Conversely, failure to hold $1.27171 could shift the focus to the next support levels.
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GBP/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Neutral Momentum: RSI at 45 and price near the 50 EMA ($1.27437) indicate limited directional bias.
- Key Levels: Resistance at $1.27957; support levels at $1.27171 and $1.26875 to watch for shifts in sentiment.
- Trading Strategy: Buy above $1.27173, target $1.27561, and manage risk with a stop loss at $1.26937.
GBP/USD is trading at $1.27340, down 0.03%, as the pair remains range-bound near the pivot point of $1.27551. The 50-day EMA at $1.27437 reflects slight bearish pressure as the price hovers just below this level, signaling caution among traders.
Immediate resistance is noted at $1.27957, with subsequent levels at $1.28367, suggesting that a recovery above the pivot could open the door for further gains.
On the downside, immediate support lies at $1.27171, with additional safety levels at $1.26875 and $1.26595. A break below $1.27171 could indicate further selling pressure, potentially driving the pair toward the $1.26298 zone.
The RSI at 45 signals neutral momentum, leaning slightly bearish but not yet oversold, leaving room for either direction depending on market catalysts.
A sustained break above $1.27551 would reinforce bullish momentum, targeting $1.27957 as the first resistance. Conversely, failure to hold $1.27171 could shift the focus to the next support levels.
GBP/USD - Trade Ideas
Entry Price – Buy Above 1.27173
Take Profit – 1.27561
Stop Loss – 1.26937
Risk to Reward – 1: 1.6
Profit & Loss Per Standard Lot = +$388/ -$236
Profit & Loss Per Mini Lot = +$38/ -$23