GBP/USD recovers its recent gains, trading higher near 1.2690 during the early European hours on Wednesday. The psychological level at 1.2700 appears as the immediate resistance followed by the weekly high of 1.2747 aligned with the major barrier at 1.2750. The Relative Strength Index (RSI) indicator on the 4-hour chart climbed to 60 and GBP/USD closed the last two 4-hour candles above the 100-period Simple Moving Average (SMA), highlighting a build-up of bullish momentum. On the upside, 1.2760 (static level) aligns as immediate resistance before 1.2780 (static level) and 1.2820 (end-point of the latest uptrend). Strong support is located at 1.2700 (100-period SMA; 50-period SMA) ahead of 1.2680 (200-period SMA) and 1.2650 (50-day SMA, Fibonacci 23.6% retracement of the latest uptrend). GBP/USD gained traction and advanced toward 1.2750 early Tuesday after closing the first day of the week virtually unchanged. The near-term technical outlook points to a build-up of bullish momentum. The upbeat market mood made it difficult for the US Dollar (USD) to gather strength early Tuesday and helped GBP/USD push higher. A Bloomberg report claiming that China was considering an equity market rescue package worth about 27 billion USD triggered a rally in Asian equity indexes and Hong Kong's Hang Seng gained nearly 3%. Meanwhile, the decline seen in the USD/JPY pair following the Bank of Japan (BoJ) Governor Kazuo Ueda's comments in the post-meeting press conference forced the USD to stay on the back foot and further supported GBP/USD.
GBP/USD is the forex ticker that shows the value of the British Pound against the US Dollar. It tells traders how many US Dollars are needed to buy a British Pound. The Pound-Dollar is one of the oldest and most widely traded currency pairs in the world. Follow the live GBP/USD rate with the chart and keep up to date with Pound-Dollar news and analysis. Plan your trades with the GBP/USD forecast and key pivot points data and support and resistance levels.
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US Dollar Forecast: Core PCE to Set Tone, Setups on EUR/USD, GBP/USD and Gold
US Dollar Forecast: Core PCE to Set Tone, Setups on EUR/USD, GBP/USD and Gold
Jan 26, 2024 3:30 AM +05:00
Diego Colman,
Contributing Strategist
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Most Read: Gold Price Forecast - Core PCE Data to Guide Markets Ahead of Fed Decision
The U.S. Bureau of Economic Analysis will release on Friday core personal consumption expenditures data, the Fed’s favorite inflation gauge. The strength or weakness of the report relative to Wall Street’s consensus estimates is likely to shape the U.S. dollar’s near-term trajectory and possibly influence the FOMC’s guidance at its January meeting next week.
In terms of estimates, core PCE is forecast to have risen 0.2% in December, bringing the annual rate down to 3.0% from 3.2% in November – a step in the right direction for policymakers, who have embarked on a historic streak of interest rate hikes to restore price stability in the post-pandemic period.
image1.png
For the U.S. dollar to continue its recent recovery, PCE numbers need to show that progress on disinflation is stalling. In this scenario, the Fed may be hesitant to cut borrowing costs substantially and may even delay the start of the easing cycle by several months.
In the event of a subdued core PCE reading below 3.0%, the greenback could take a sharp turn to the downside. Weak inflation numbers could help validate the market pricing of deep interest rate cuts, pushing Treasury yields lower – an outcome poised to reduce the attractiveness of the U.S. currency.
For an extensive analysis of the euro’s medium-term prospects, download our Q1 technical and fundamental forecast. The trading guide is free!
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EUR/USD TECHNICAL ANALYSIS
EUR/USD fell on Thursday, slipping below its 200-day simple moving average near 1.0840. If prices fail to reverse higher and close below this level for the week, we could see a pullback towards 1.0770 over the next few trading sessions. On further weakness, all eyes will be on trendline support near 1.0710.
In the event of a market turnaround and push above the 200-day SMA, initial resistance appears at 1.0880, followed by 1.0920/1.0935. The bullish camp might encounter challenges in driving prices beyond this technical barrier, yet a successful breakout could pave the way for a move towards 1.1020.
EUR/USD TECHNICAL CHART
A screen shot of a graph Description automatically generated
EUR/USD Chart Created Using TradingView
For a complete overview of the pound’s outlook over the next three months, make sure to download our complimentary quarterly forecast!
GBP/USD
BEARISH
Data provided by
of clients are net short.
CHANGE IN LONGS SHORTS OI
DAILY 8% -5% 1%
WEEKLY -3% -6% -5%
What does it mean for price action?
Get My Guide
GBP/USD TECHNICAL ANALYSIS
GBP/USD retreated on Thursday after failing to clear the upper limit of a symmetrical triangle, a continuation pattern that has been developing since the middle of last month. For context, this technical setup is validated once prices move outside the boundaries of the triangle, with the confirmation signal carrying greater strength if the breakout occurs in the direction of the prevailing trend.
In the case of GBP/USD, traders should watch two areas in the coming days and weeks: resistance at 1.2750/1.2770 and support at 1.2620/1.2600. A breach of resistance could pave the way for a rally towards 1.2830 and, potentially, 1.3000. Conversely, a move below support could expose the 200-day simple moving average and, in the most extreme case, lead to a pullback towards 1.2455.
GBP/USD is the forex ticker that shows the value of the British Pound against the US Dollar. It tells traders how many US Dollars are needed to buy a British Pound. The Pound-Dollar is one of the oldest and most widely traded currency pairs in the world. Follow the live GBP/USD rate with the chart and keep up to date with Pound-Dollar news and analysis. Plan your trades with the GBP/USD forecast and key pivot points data and support and resistance levels.
1 Search
Search
Free Trading Guides
Subscribe to Our Newsletter
Market News
Analysis
Currencies
Commodities
Stocks
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Tools
Calendars
Education
About Us
English
EUR/USD
BEARISH
OIL - US CRUDE
BULLISH
More
NEWS
Commodities Update: As of 19:00, these are your best and worst performers based on the London trading schedule: Silver: 0.92% Gold...
Indices Update: As of 21:00, these are your best and worst performers based on the London trading schedule: France 40: 0.87% Wall ...
Earnings
Monetary Policy
More
US Dollar Forecast: Core PCE to Set Tone, Setups on EUR/USD, GBP/USD and Gold
US Dollar Forecast: Core PCE to Set Tone, Setups on EUR/USD, GBP/USD and Gold
Jan 26, 2024 3:30 AM +05:00
Diego Colman,
Contributing Strategist
Share:
What's on this page
Most Read: Gold Price Forecast - Core PCE Data to Guide Markets Ahead of Fed Decision
The U.S. Bureau of Economic Analysis will release on Friday core personal consumption expenditures data, the Fed’s favorite inflation gauge. The strength or weakness of the report relative to Wall Street’s consensus estimates is likely to shape the U.S. dollar’s near-term trajectory and possibly influence the FOMC’s guidance at its January meeting next week.
In terms of estimates, core PCE is forecast to have risen 0.2% in December, bringing the annual rate down to 3.0% from 3.2% in November – a step in the right direction for policymakers, who have embarked on a historic streak of interest rate hikes to restore price stability in the post-pandemic period.
image1.png
For the U.S. dollar to continue its recent recovery, PCE numbers need to show that progress on disinflation is stalling. In this scenario, the Fed may be hesitant to cut borrowing costs substantially and may even delay the start of the easing cycle by several months.
In the event of a subdued core PCE reading below 3.0%, the greenback could take a sharp turn to the downside. Weak inflation numbers could help validate the market pricing of deep interest rate cuts, pushing Treasury yields lower – an outcome poised to reduce the attractiveness of the U.S. currency.
For an extensive analysis of the euro’s medium-term prospects, download our Q1 technical and fundamental forecast. The trading guide is free!
EUR ForecastEUR Forecast
RECOMMENDED BY DIEGO COLMAN
Get Your Free EUR Forecast
Get My Guide
EUR/USD TECHNICAL ANALYSIS
EUR/USD fell on Thursday, slipping below its 200-day simple moving average near 1.0840. If prices fail to reverse higher and close below this level for the week, we could see a pullback towards 1.0770 over the next few trading sessions. On further weakness, all eyes will be on trendline support near 1.0710.
In the event of a market turnaround and push above the 200-day SMA, initial resistance appears at 1.0880, followed by 1.0920/1.0935. The bullish camp might encounter challenges in driving prices beyond this technical barrier, yet a successful breakout could pave the way for a move towards 1.1020.
EUR/USD TECHNICAL CHART
A screen shot of a graph Description automatically generated
EUR/USD Chart Created Using TradingView
For a complete overview of the pound’s outlook over the next three months, make sure to download our complimentary quarterly forecast!
GBP/USD
BEARISH
Data provided by
of clients are net short.
CHANGE IN LONGS SHORTS OI
DAILY 8% -5% 1%
WEEKLY -3% -6% -5%
What does it mean for price action?
Get My Guide
GBP/USD TECHNICAL ANALYSIS
GBP/USD retreated on Thursday after failing to clear the upper limit of a symmetrical triangle, a continuation pattern that has been developing since the middle of last month. For context, this technical setup is validated once prices move outside the boundaries of the triangle, with the confirmation signal carrying greater strength if the breakout occurs in the direction of the prevailing trend.
In the case of GBP/USD, traders should watch two areas in the coming days and weeks: resistance at 1.2750/1.2770 and support at 1.2620/1.2600. A breach of resistance could pave the way for a rally towards 1.2830 and, potentially, 1.3000. Conversely, a move below support could expose the 200-day simple moving average and, in the most extreme case, lead to a pullback towards 1.2455.
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