GBP/USD – The Pair Is Likely To Remain Bearish For A While
- Take Profit: 1.2800
- Stop Loss : 1.2900
- Timeline: 1 day
- Buy Stop : 1.2890
- Take Profit: 1.2950
- Stop Loss : 1.2800
Following the publication of UK consumer inflation and retail sales data, we observed a decline in the pair price. The pair dropped to 1.2850, touching a crucial support level, and is now waiting for the Federal Reserve to announce its interest rate policy. The bearish trend began after a decrease in inflation rates, to 7.9% in June, was shown by UK CPI data. Additionally, core inflation lowered, and the overall fall was greater than what economists had predicted. The increase in retail sales brought on by the warm weather is a beneficial to the UK economy.
The charts revealed how the retail sales figures caused a dip to the important support level, which led to the pair trading at 1.2850 when the highest price level for the month was 1.3144. The 25-period and 50-period Moving Averages are forming a bearish crossover, and the RSI has passed over the oversold level. The price is currently at a psychological level and its largest swing since June 16th. As a result, we presently anticipate a bearish trend in the price of the cable pair.
Many economists think that the Bank of England will announce a 0.25% rate increase at its upcoming meeting. Before the announcement of the inflation numbers, a rate increase of 0.50% was anticipated; however, the bank is currently likely to slow down because the inflation rate is not as concerning as it once was. Preliminary Manufacturing and Service PMI Numbers will be the next significant data releases concerning the pair. According to analysts, the manufacturing sector may experience signs of shrinkage in July. A key event that will impact the pair is the Fed rate hike and analysts anticipate it to be 0.25% at the forthcoming meeting.