Fundamental
Overview
The lack of catalysts
recently kept the US Dollar supported across the board despite the slowdown in
momentum. The market might now be looking forward to the first weeks of
November when we will get the key economic data, the FOMC decision and the US
elections.
There’s been also a good
argument that the markets are already positioning for a Trump victory and that
should translate in USD strength as it should appreciate on higher growth and
less rate cuts expectations. Nevertheless, not all markets have been in sync
with this view.
On the GBP side, we got the
UK CPI report last week where the data missed
expectations across the board and prompted the market to expect another 25 bps
cut in December. In 2025, the market sees roughly four more rate cuts.
GBPUSD
Technical Analysis – Daily Timeframe
On the daily chart, we can
see that GBPUSD is now trading below the 1.30 handle although the pair remains
in a consolidation just beneath the key level. We are now getting close to the
major trendline where we can expect the buyers to
step in with a defined risk below it to position for a rally into new highs.
The sellers, on the other hand, will want to see the price breaking lower to
increase the bearish bets into the 1.27 handle next.
GBPUSD Technical
Analysis – 4 hour Timeframe
On the 4 hour chart, we can
see that we have a minor downward trendline defining the current bearish momentum.
If the price gets there we can expect the sellers to lean on it to position for
new lows, while the buyers will look for a break higher to increase the bullish
bets into the 1.32 handle.
GBPUSD Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can
see more clearly the recent price action with kind of a range between the
1.2972 low and the 1.30 handle as resistance.
The sellers will want to see the price breaking lower to increase the bearish
bets into the major trendline, while the buyers will look for a break higher to
target a rally into the downward trendline. The red line define the average daily range for today.
Upcoming
Catalysts
This week is pretty empty on the data front with market moving releases scheduled
for the latter part of the week. On Thursday, we get the Flash UK and US PMIs,
and the US Jobless Claims figures.
This article was written by Giuseppe Dellamotta at www.forexlive.com.
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