-1699872226.png)
GBP Traders Await Inflation Data
GBPUSD continues to cling to support around the 1.2171 level. The level has acted as a magnet over recent months with price oscillating around that price point since mid-September. An attempt earlier this month at breaking higher saw price running into trouble at the 1.2437 level with that area acting as key resistance now.
UK Recession Risks
In recent days, focus has shifted back onto potential UK recession risks. The first look at Q3 GDP saw growth at 0%, down from 0.2% over the prior quarter and barely above the -0.1% the market was looking for. With risks that the final figure comes in negative, fears of a downturn are acting as a barrier to higher prices.
Hawkish BOE Expectations
However, GBP has managed to avoid a fresh leg lower, perhaps driven by hawkish BOE expectations. The BOE warned last time around that further tightening would likely still be needed and cannot be ruled out. Focus now turns to UK CPI due on Wednesday. The annual figure is expected to fall sharply to 4.7% from 6.7% prior. If seen, this should keep GBP anchored firmly lower near-term. However, any stickiness will no doubt drive fresh buying in the Pound as traders focus on BOE tightening expectations.
Technical Views
GBPUSD
For now, the pair continues to hold in range between 1.2171 and 1.2437, still above the broken bear channel highs. While 1.2171 holds, a further push higher still looks likely, in line with bullish momentum studies readings. Should we break below 1.2171, however, focus turns to deeper support at the 1.1843 level.
.png)
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.