Basic overview
The USD continues to consolidate around the high levels except against commodity currencies where it has been gaining the upper hand. Last week's US inflation data was disappointing again although the data that feeds into the Core PCE overall was mixed as forecasters of the expected to increase 0.13% M / M.
Nevertheless, the Financial Results continue to climb and are now back around their post-US election highs. There is some understandable uneasiness in the bond market with the hot US data and the Fed continuing to cut into an accelerating economy.
On the GBP side, the UK jobs report today came in better than expected, especially on wage growth which strengthened the likelihood that the BoE will remain on hold this week and reduced the chances of three rate cuts in 2025.
GBPUSD Technical Analysis – Daily Time Chart
GBPUSD daily
On the daily chart, we can see that GBPUSD failed to extend the rally after breaking above the downtrend. line of motion and they sold all the way back to the main trend line. This is where the buyers step into position to rally to new highs, while the sellers look for a break below the main trend line to target a drop into the 1.23 handle next.
GBPUSD Technical Analysis – 4 hour timeframe
GBPUSD 4 hours
On the 4 hour chart, we can see that we have a strong zone around the 1.2715 level where the price has responded several times in the past weeks. The sellers are likely to continue to position for a break below the main trend line, while the buyers will look for a break higher to target new highs.
GBPUSD Technical Analysis – 1 hour timeframe
GBPUSD 1 hour
On the 1 hour chart, we can see that we have a small uptrend which defines the current bullish trend in this timeframe. The buyers are likely to continue to position for the break above the 1.2715 zone, while the sellers will be looking for a break below to increase the bearish bets into the main movement The red lines define the
average daily range for today.
Catalysts to come
Todaywe get US Retail Sales data. Tomorrow, we have the UK CPI report and the FOMC Policy Decision. On Thursday, we have the BoE Policy Decision and US Jobless Claims figures. On Friday, we finish the week with UK Retail Sales and US PCE data.
