GBPUSD | Perspective for the new week | Follow-up
Updated
The British Pound gains significant traction as the UK Office for National Statistics reports a rebound in Retail Sales for July, with monthly and annual figures rising by 0.5% and 1.4% respectively. This momentum comes ahead of the Bank of England’s (BoE) crucial September monetary policy meeting, where decisions could hinge on the sharp decline in service sector inflation and a surprising drop in the Unemployment Rate, signalling an expanding economy.
On the US front, jobless claims continue to fall for the second consecutive week, challenging the earlier Nonfarm Payrolls (NFP) data that suggested a weaker labor market. Market speculation for large rate cuts has eased, yet expectations for a dovish Federal Reserve decision in September remain strong, with policymakers signalling comfort with upcoming interest-rate cuts.
With these recent developments, the GBPUSD remains in a volatile state. The rebound in UK retail sales and the positive signals from the US labor market suggests that there is potential for further gains for the British pound. However, the BoE's policy decision and the Fed's stance on interest rates will be key factors to watch in the coming weeks.
How will buyers and sellers position themselves in the coming week?
GBPUSD Technical Analysis:
Will buyers break above $1.29500 next week? Watch this video for key trades this week. Join the discussion for updates on GBP/USD trading. Stay tuned for more content. Happy trading!
Disclaimer Notice:
Trading in the foreign exchange market and other instruments carries high risk and may not be suitable for all investors. The content provided here is for educational purposes only. Evaluate your financial situation and consult with a financial advisor before making any investment decisions. Past performance is not indicative of future results.
On the US front, jobless claims continue to fall for the second consecutive week, challenging the earlier Nonfarm Payrolls (NFP) data that suggested a weaker labor market. Market speculation for large rate cuts has eased, yet expectations for a dovish Federal Reserve decision in September remain strong, with policymakers signalling comfort with upcoming interest-rate cuts.
With these recent developments, the GBPUSD remains in a volatile state. The rebound in UK retail sales and the positive signals from the US labor market suggests that there is potential for further gains for the British pound. However, the BoE's policy decision and the Fed's stance on interest rates will be key factors to watch in the coming weeks.
How will buyers and sellers position themselves in the coming week?
GBPUSD Technical Analysis:
Will buyers break above $1.29500 next week? Watch this video for key trades this week. Join the discussion for updates on GBP/USD trading. Stay tuned for more content. Happy trading!
Disclaimer Notice:
Trading in the foreign exchange market and other instruments carries high risk and may not be suitable for all investors. The content provided here is for educational purposes only. Evaluate your financial situation and consult with a financial advisor before making any investment decisions. Past performance is not indicative of future results.
Note
The week kicks off on a bullish note with the British Pound extending last week’s breakout, climbing above the $1.29500 zone [identified in the video] during the Asian session.
The GBP continues to find support from last week’s robust UK macro data, suggesting a resilient economy and reducing the likelihood of another interest rate cut by the Bank of England in September. Meanwhile, the US Dollar remains under pressure amid dovish Federal Reserve expectations, providing a further tailwind for the GBP/USD pair.
At this juncture, traders are likely to hold back on making any aggressive bets as they await clearer signals on the Fed's rate-cut path. The focus will now be on the FOMC meeting minutes due Wednesday, followed by the flash global PMIs on Thursday and Fed Chair Jerome Powell's speech at the Jackson Hole Symposium later in the week.
In light of these key events, we've identified a new structure on the 1H timeframe to guide our trading strategy. We shall keep an eye on the chart below for potential opportunities.
Good Morning
Trade active
#GBPUSD
Buy position triggered; time to secure position as we look out for new trading opportunities.
Trade active
Another buy position has been triggered as GBP/USD hits a fresh monthly high, holding steady above the $1.3000 mark. The British pound is taking full advantage of the US Dollar's weakness, fueled by strong speculation that the Federal Reserve may begin cutting interest rates in September.
This week, the key events to watch for the US Dollar will be the release of the FOMC minutes on Wednesday and Fed Chair Jerome Powell's speech at the Jackson Hole Symposium from August 22-24. Investors will be keen to gauge whether the Fed plans to move aggressively or take a more gradual approach toward policy normalization.
As we wait for the US and UK S&P Global PMI data for August, due out on Thursday, we'll continue to use the newly identified ascending trendline as our guide. Now is a good time to lock in some profits while keeping an eye on new trading opportunities ahead.
Good Morning
Trade closed manually
All buy positions have been closed as GBP/USD sees a pullback, driven by renewed demand for the US Dollar amid a cautious market tone. This presents a good moment to take a breather before the high-impact data releases in the latter part of the week.
So far this week, the Pound has benefited from overall US Dollar weakness, with market sentiment remaining strong as we await key business activity surveys and the Jackson Hole Economic Symposium.
As we prepare for these events, the ascending trendline continues to serve as our guide for trading decisions. We’ll delve deeper into this market structure in our upcoming live session. See you there!
Good Morning
Trade active
Another buy position is active with a 90 pips in profit as the GBP/USD holds steady, trading slightly higher during the Asian session.
The UK’s flash August S&P Global/CIPS PMI report revealed stronger-than-expected economic expansion, driven by a combination of robust growth, improved job creation, and easing inflation. This positive data has brightened the outlook for the British Pound, as it could dampen expectations of the Bank of England cutting interest rates in September—something that had been anticipated following the July decline in service sector inflation.
Given this favorable development, it’s a good time to lock in some profits while staying patient for new trading opportunities. The ascending trendline continues to serve as our key guide for the rest of the week.
Good Morning
Trade smart. Trade consciously
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