GBPUSD | Big pullback before the significant rally in 2024
The analysis of GBP/USD reveals a dynamic interplay of factors influencing the currency pair. The British Pound (GBP) has strengthened against the US Dollar (USD), recovering from a decline to 1.2700 and surpassing 1.2750. This recovery is linked to challenges the USD faces in generating demand during the American session, partly influenced by softer-than-expected Producer Price Index (PPI) data for December. Technically, GBP/USD maintains a bullish stance, staying above the lower limit of an ascending regression channel, with the Relative Strength Index (RSI) above 50, indicating positive momentum. Key resistance levels are at 1.2780, 1.2830, and 1.2860, while supports lie at 1.2750, 1.2710-1.2700, and 1.2670. The positive shift in market sentiment, along with UK GDP growth in November, supports GBP/USD. US inflation data, with a 3.4% increase in the Consumer Price Index (CPI) for December, initially boosted the USD, but skepticism remains about the Fed refraining from a rate cut in March. The CME FedWatch Tool indicates a 70% probability of a 25 basis points rate cut. The broader economic context, including inflation trends, central bank expectations, and global market sentiment, will continue to shape the GBP/USD exchange rate. This was a brief overview of the GBP/USD landscape; I'll now turn to the chart for my personal expectations and explanation. Greetings and a good weekend to everyone from Nicola.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.