GBPUSD - Bullish channelGBPUSD - Intraday - We look to Buy at 1.2075 (stop at 1.1990)
Although the bears are in control, the stalling negative momentum indicates a turnaround is possible. This is positive for sentiment and the uptrend has the potential to return. The trend of higher lows is located at 1.1900. The preferred trade is to buy on dips.
Our profit targets will be 1.2325 and 1.2660
Resistance : 1.2660 / 1.3295 / 1.3750
Support: 1.2110 / 1.1770 / 1.1490
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Gbp-usd
GBPUSD Potential for Bearish Drop | 6th December 2022Looking at the H4 chart, my overall bias for GBPUSD is bullish due to the current price being above the Ichimoku cloud , indicating a bullish market. However, I am looking for a pullback sell entry. Looking for a sell entry at 1.22770, where the previous swing high is. Stop loss will be placed at 1.26669, where the previous swing high and 127.2% Fibonacci extension line is. Take profit will be at 1.19008, where the previous low and 78.6% Fibonacci line is.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
GBPUSD Potential for Bullish Continuation | 5th December 2022Looking at the H4 chart, my overall bias for GBPUSD is bullish due to the current price being above the Ichimoku cloud, indicating a bullish market. Looking for a buy entry at 1.22770, where the previous swing high is. Stop loss will be placed at 1.19008, where the previous low and 78.6% Fibonacci line is. Take profit will be at 1.26669, where the previous swing high and 127.2% Fibonacci extension line is.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary, and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interest arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed on the website.
GBP USD - FUNDAMENTAL DRIVERSGBP
FUNDAMENTAL OUTLOOK: WEAK BEARISH
BASELINE
A looming recession has been a key source of Pound weakness and has kept pressure on Sterling despite ongoing BoE hikes. At their NOV policy decision, the BoE’s updated projections showed a deeper and longer recession than previously thought, as well as a stern push back against current market pricing for the high implied rate path. However, rate markets did not respond to this with only marginal downside in terminal rate expectations. With the new budget now out of the way, the markets should turn their attention to what this means for the economic outlook and means economic data & BoE policy should start to matter a bit more again. Unfortunately, the week ahead is extremely light so the main driver will probably be overall risk sentiment.
POSSIBLE BULLISH SURPRISES
With recession the base assumption, any incoming data that surprises meaningfully higher could trigger relief for the GBP. With focus on stagflation, any downside surprises in CPI or factors that decrease inflation pressures are expected to support the GBP and not pressure it. Any overly positive takes from BoE speak regarding the budget could be taken as a positive for Sterling.
POSSIBLE BEARISH SURPRISES
With recession the base assumption, any material downside surprises in growth data can still trigger short-term pressure. With focus on stagflation, any upside surprises in CPI or factors that increase more inflation pressures are expected to weigh on the GBP and not support it. Any overly negative takes from BoE speak regarding the budget could be taken as a negative for Sterling.
BIGGER PICTURE
The fundamentals for Sterling remain bearish with the UK already in a recession based on recent data. At least the new PM has provided some calm to the fiscal situation and political uncertainty though. Expectations are for a lot of pain ahead for the UK economy which means the fundamental outlook remains bearish . But with a lot of bad news priced, we’re looking for shortterm upside opportunities.
USD
FUNDAMENTAL OUTLOOK: BULLISH
BASELINE
The Fed is on a data-dependent (meeting-by-meeting) policy stance, meaning incoming growth, inflation and jobs data remains a key driver for short-term USD volatility where we expect a cyclical reaction for both the USD and US10Y (good data expected to be supportive for the USD and US yields while bad data is expected to pressure the USD and US yields). The Fed is still under pressure to continue hiking rates and ramping up QT, but last week’s decent deceleration in the OCT CPI report has given markets some solace from inflation angst. Money markets shed about 30bsp off the implied terminal rate. As a result of this the USD saw intense selling but has largely stabilized this week. Like we’ve said many times, right now is all about the data. The data will lead the Fed, which means the data is what we should follow for high probability short-term directional flows for the USD. In the week ahead, we have a few of important data points such as ISM Manufacturing PMI and NFP on Friday. However, also pay close attention to the scheduled speech from Fed Chair Powell on Wednesday.
POSSIBLE BULLISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely good growth, inflation or jobs data is expected to trigger short-term bullish reactions in the USD. If the cyclical outlook continues to weaken, the USD’s safe haven status still matters. Any incoming catalysts that increase deep recession fears and triggers strong moves lower in risk assets & bonds can trigger safe haven flows into the USD. With a lot priced for the Fed and USD, the bar is high for hawkish Fed surprises, but any aggressive Fed speak talking up a >5.5% terminal rate can trigger further USD upside. The speech from Fed Chair Powell will be important. If he delivers the same stern hawkish tone that accompanied the prior FOMC presser, it can provide upside for the USD.
POSSIBLE BEARISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely bad growth, inflation or jobs data is expected to trigger short-term bearish reactions in the USD. If the cyclical outlook starts to improve, the USD’s safe haven status still matters. Any incoming catalysts that decrease deep recession fears and triggers strong moves higher in risk assets & bonds can trigger safe haven outflows out of the USD. With a lot priced in for the Fed and the USD, it won’t take much to disappoint on the dovish side. Any big concerns about growth from Fed speakers could trigger outflows.
BIGGER PICTURE
The fundamental outlook for the USD remains bullish as long as the Fed stays aggressively hawkish and cyclical concerns put pressure on risk sentiment. However, it’s also important to remember that the data leads the Fed. That means, even though the USD remains fundamentally bullish in the currency negative cyclical environment, it’s short-term direction will largely be determined by the incoming data. Thus, in the current context, we prefer trading the USD in the short-term with scalps out of key US economic data points.
InvestMate|GBP/USD Don't count on continuation of increases💷💵💷💵GBP/USD Don't count on continuation of increases
💷💵GBP/USD Finally reached an important price level marked by a resistance zone. As we can see, the price has repeatedly found it difficult to continue upwards at these points in the past.
💷💵Will this be the case this time too?
💷💵The support zone to which I expect the price to descend is around the cluster of three fibo levels. The first is 0.382 of the entire current upward impulse. The second is the outer level of 1.272 of the entire downward wave from the 1992 peak to the 2001 bottom. The third is the level of 0.886 of the entire upward wave from the 1985 bottom to the 1992 peak.
💷💵This is the strongest closest support zone, if we were to fall on it I would expect a strong price reaction.
💷💵The scenario I am playing out is the start of a decline with a target landing on the support zone within the next few weeks. I am aware of the possibility of a correction at any time, this should be taken into account, If the outlook would change I will publish a post with an update, so I encourage you to actively follow the profile and read the description carefully.
💷💵 *Please do not suggest the path I have drawn with the lines this is only a hypothetical scenario.
🚀If you appreciate my work and effort put into this post I encourage you to leave a like and give a follow on my profile.🚀
A race! GBPUSD or EURUSD to go higher faster?Similar to the EURUSD, the GBPUSD continued to surge strongly to the upside as the price broke beyond several key resistance levels to test the 1.23 price area.
While the GBPUSD could retrace briefly down toward the 1.2150 and 1.22 price area, look for the development of the price action to signal a continuation of the uptrend.
If the GBPUSD breaks strongly above the 1.23 resistance level, the price could continue trading higher toward the next key resistance level of 1.2645.
GBP USD - FUNDAMENTAL DRIVERSGBP
FUNDAMENTAL OUTLOOK: WEAK BEARISH
BASELINE
A looming recession has been a key source of Pound weakness and has kept pressure on Sterling despite ongoing BoE hikes. At their NOV policy decision, the BoE’s updated projections showed a deeper and longer recession than previously thought, as well as a stern push back against current market pricing for the high implied rate path. However, rate markets did not respond to this with only marginal downside in terminal rate expectations. With the new budget now out of the way, the markets should turn their attention to what this means for the economic outlook and means economic data & BoE policy should start to matter a bit more again. Unfortunately, the week ahead is extremely light so the main driver will probably be overall risk sentiment.
POSSIBLE BULLISH SURPRISES
With recession the base assumption, any incoming data that surprises meaningfully higher could trigger relief for the GBP. With focus on stagflation, any downside surprises in CPI or factors that decrease inflation pressures are expected to support the GBP and not pressure it. Any overly positive takes from BoE speak regarding the budget could be taken as a positive for Sterling.
POSSIBLE BEARISH SURPRISES
With recession the base assumption, any material downside surprises in growth data can still trigger short-term pressure. With focus on stagflation, any upside surprises in CPI or factors that increase more inflation pressures are expected to weigh on the GBP and not support it. Any overly negative takes from BoE speak regarding the budget could be taken as a negative for Sterling.
BIGGER PICTURE
The fundamentals for Sterling remain bearish with the UK already in a recession based on recent data. At least the new PM has provided some calm to the fiscal situation and political uncertainty though. Expectations are for a lot of pain ahead for the UK economy which means the fundamental outlook remains bearish . But with a lot of bad news priced, we’re looking for shortterm upside opportunities.
USD
FUNDAMENTAL OUTLOOK: BULLISH
BASELINE
The Fed is on a data-dependent (meeting-by-meeting) policy stance, meaning incoming growth, inflation and jobs data remains a key driver for short-term USD volatility where we expect a cyclical reaction for both the USD and US10Y (good data expected to be supportive for the USD and US yields while bad data is expected to pressure the USD and US yields). The Fed is still under pressure to continue hiking rates and ramping up QT, but last week’s decent deceleration in the OCT CPI report has given markets some solace from inflation angst. Money markets shed about 30bsp off the implied terminal rate. As a result of this the USD saw intense selling but has largely stabilized this week. Like we’ve said many times, right now is all about the data. The data will lead the Fed, which means the data is what we should follow for high probability short-term directional flows for the USD. In the week ahead, we have a few of important data points such as ISM Manufacturing PMI and NFP on Friday. However, also pay close attention to the scheduled speech from Fed Chair Powell on Wednesday.
POSSIBLE BULLISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely good growth, inflation or jobs data is expected to trigger short-term bullish reactions in the USD. If the cyclical outlook continues to weaken, the USD’s safe haven status still matters. Any incoming catalysts that increase deep recession fears and triggers strong moves lower in risk assets & bonds can trigger safe haven flows into the USD. With a lot priced for the Fed and USD, the bar is high for hawkish Fed surprises, but any aggressive Fed speak talking up a >5.5% terminal rate can trigger further USD upside. The speech from Fed Chair Powell will be important. If he delivers the same stern hawkish tone that accompanied the prior FOMC presser, it can provide upside for the USD.
POSSIBLE BEARISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely bad growth, inflation or jobs data is expected to trigger short-term bearish reactions in the USD. If the cyclical outlook starts to improve, the USD’s safe haven status still matters. Any incoming catalysts that decrease deep recession fears and triggers strong moves higher in risk assets & bonds can trigger safe haven outflows out of the USD. With a lot priced in for the Fed and the USD, it won’t take much to disappoint on the dovish side. Any big concerns about growth from Fed speakers could trigger outflows.
BIGGER PICTURE
The fundamental outlook for the USD remains bullish as long as the Fed stays aggressively hawkish and cyclical concerns put pressure on risk sentiment. However, it’s also important to remember that the data leads the Fed. That means, even though the USD remains fundamentally bullish in the currency negative cyclical environment, it’s short-term direction will largely be determined by the incoming data. Thus, in the current context, we prefer trading the USD in the short-term with scalps out of key US economic data points.
GBP/USDGBP/USD
News about the refusal to hold another referendum on Scottish independence has already been worked out. Technical factors give signals for continued growth, but macroeconomic factors do not support this trend. Active growth requires going beyond the resistance level of 1.2250-1.2300. Selling requires a confident breakout of the 1.1850 zone.
GBP/USD Trade 11/30 Hello, First post here. No audio so forgive me, I am at work. Today is 11/30/2022
Check out my trade on GBP/USD for $52 return on 15,000 lot size.
I have made arrows where I entered & also my confirmations on the indicators I am using. Feel free to pause the video & see which indicators I use or message me.
Look forward to having more videos & more/better content so follow me :)
GBP USD - FUNDAMENTAL DRIVERSGBP
FUNDAMENTAL OUTLOOK: WEAK BEARISH
BASELINE
A looming recession has been a key source of Pound weakness and has kept pressure on Sterling despite ongoing BoE hikes. At their NOV policy decision, the BoE’s updated projections showed a deeper and longer recession than previously thought, as well as a stern push back against current market pricing for the high implied rate path. However, rate markets did not respond to this with only marginal downside in terminal rate expectations. With the new budget now out of the way, the markets should turn their attention to what this means for the economic outlook and means economic data & BoE policy should start to matter a bit more again. Unfortunately, the week ahead is extremely light so the main driver will probably be overall risk sentiment.
POSSIBLE BULLISH SURPRISES
With recession the base assumption, any incoming data that surprises meaningfully higher could trigger relief for the GBP. With focus on stagflation, any downside surprises in CPI or factors that decrease inflation pressures are expected to support the GBP and not pressure it. Any overly positive takes from BoE speak regarding the budget could be taken as a positive for Sterling.
POSSIBLE BEARISH SURPRISES
With recession the base assumption, any material downside surprises in growth data can still trigger short-term pressure. With focus on stagflation, any upside surprises in CPI or factors that increase more inflation pressures are expected to weigh on the GBP and not support it. Any overly negative takes from BoE speak regarding the budget could be taken as a negative for Sterling.
BIGGER PICTURE
The fundamentals for Sterling remain bearish with the UK already in a recession based on recent data. At least the new PM has provided some calm to the fiscal situation and political uncertainty though. Expectations are for a lot of pain ahead for the UK economy which means the fundamental outlook remains bearish. But with a lot of bad news priced, we’re looking for shortterm upside opportunities.
USD
FUNDAMENTAL OUTLOOK: BULLISH
BASELINE
The Fed is on a data-dependent (meeting-by-meeting) policy stance, meaning incoming growth, inflation and jobs data remains a key driver for short-term USD volatility where we expect a cyclical reaction for both the USD and US10Y (good data expected to be supportive for the USD and US yields while bad data is expected to pressure the USD and US yields). The Fed is still under pressure to continue hiking rates and ramping up QT, but last week’s decent deceleration in the OCT CPI report has given markets some solace from inflation angst. Money markets shed about 30bsp off the implied terminal rate. As a result of this the USD saw intense selling but has largely stabilized this week. Like we’ve said many times, right now is all about the data. The data will lead the Fed, which means the data is what we should follow for high probability short-term directional flows for the USD. In the week ahead, we have a few of important data points such as ISM Manufacturing PMI and NFP on Friday. However, also pay close attention to the scheduled speech from Fed Chair Powell on Wednesday.
POSSIBLE BULLISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely good growth, inflation or jobs data is expected to trigger short-term bullish reactions in the USD. If the cyclical outlook continues to weaken, the USD’s safe haven status still matters. Any incoming catalysts that increase deep recession fears and triggers strong moves lower in risk assets & bonds can trigger safe haven flows into the USD. With a lot priced for the Fed and USD, the bar is high for hawkish Fed surprises, but any aggressive Fed speak talking up a >5.5% terminal rate can trigger further USD upside. The speech from Fed Chair Powell will be important. If he delivers the same stern hawkish tone that accompanied the prior FOMC presser, it can provide upside for the USD.
POSSIBLE BEARISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely bad growth, inflation or jobs data is expected to trigger short-term bearish reactions in the USD. If the cyclical outlook starts to improve, the USD’s safe haven status still matters. Any incoming catalysts that decrease deep recession fears and triggers strong moves higher in risk assets & bonds can trigger safe haven outflows out of the USD. With a lot priced in for the Fed and the USD, it won’t take much to disappoint on the dovish side. Any big concerns about growth from Fed speakers could trigger outflows.
BIGGER PICTURE
The fundamental outlook for the USD remains bullish as long as the Fed stays aggressively hawkish and cyclical concerns put pressure on risk sentiment. However, it’s also important to remember that the data leads the Fed. That means, even though the USD remains fundamentally bullish in the currency negative cyclical environment, it’s short-term direction will largely be determined by the incoming data. Thus, in the current context, we prefer trading the USD in the short-term with scalps out of key US economic data points.
GBP/USD:BUY From SUPPORT Area 50% FIBO For A LONG SetupGBP/USD coming from a Bullish trend, in the last session the price made a Double Bottom in confluence with the Support area and the 50% Fibonacci levels. Today the ADP Non-Farm Employment Change and the JOLTS Job Openings with negative forecast for USD can help the price to grow in its favor. We are looking for a new Long impulse.
GBPUSD | COULD BE A GOOD BUY ONLY IF...Hello traders,
If the next candlestick manages to close as a bullish engulfing one we could have a re-test of the previous top level which would be pretty nice.
Obviously split your take profits accordingly maybe in 1/3 and manage your risk to max pip gain.
If however, this does not happen then we could be a looking at a higher timeframe rejection from a trend
GBPUSD H4: Bearish outlook seen, further downside below 1.1980On the H4 time frame, a break below the downside confirmation level at 1.1980 could provide the bearish acceleration to our next support zone at 1.1650, which is in line with the Fibonacci confluence levels. The downside confirmation level coincides with the 50% Fibonacci retracement and ascending trend line where a break and close below this zone is needed before we could see more downside to the next support target at 1.1650. Stochastic is reversing below its resistance as well where we could see further downside in line with prices.
GBPUSD to the 1.21? 🦐GBPUSD after testing with a spike retraced at the 0.886 Fibonacci level and is looking for direction.
The market overall remains in a bullish trend in the short term and a new recent high can be seen.
How can i approach this scenario?
I will wait for a possible break of the resistance area and if that happen i will set a nice long order according to the Plancton's strategy rules.
------
Follow the Shrimp 🦐
Keep in mind.
🟣 Purple structure -> Monthly structure.
🔴 Red structure -> Weekly structure.
🔵 Blue structure -> Daily structure.
🟡 Yellow structure -> 4h structure.
⚫️ Black structure -> >4h structure.
Here is the Plancton0618 technical analysis , please comment below if you have any question.
The ENTRY in the market will be taken only if the condition of the Plancton0618 strategy will trigger.
GBP USD - FUNDAMENTAL DRIVERSGBP
FUNDAMENTAL OUTLOOK: WEAK BEARISH
BASELINE
A looming recession has been a key source of Pound weakness and has kept pressure on Sterling despite ongoing BoE hikes. At their NOV policy decision, the BoE’s updated projections showed a deeper and longer recession than previously thought, as well as a stern push back against current market pricing for the high implied rate path. However, rate markets did not respond to this with only marginal downside in terminal rate expectations. With the new budget now out of the way, the markets should turn their attention to what this means for the economic outlook and means economic data & BoE policy should start to matter a bit more again. Unfortunately, the week ahead is extremely light so the main driver will probably be overall risk sentiment.
POSSIBLE BULLISH SURPRISES
With recession the base assumption, any incoming data that surprises meaningfully higher could trigger relief for the GBP. With focus on stagflation, any downside surprises in CPI or factors that decrease inflation pressures are expected to support the GBP and not pressure it. Any overly positive takes from BoE speak regarding the budget could be taken as a positive for Sterling.
POSSIBLE BEARISH SURPRISES
With recession the base assumption, any material downside surprises in growth data can still trigger short-term pressure. With focus on stagflation, any upside surprises in CPI or factors that increase more inflation pressures are expected to weigh on the GBP and not support it. Any overly negative takes from BoE speak regarding the budget could be taken as a negative for Sterling.
BIGGER PICTURE
The fundamentals for Sterling remain bearish with the UK already in a recession based on recent data. At least the new PM has provided some calm to the fiscal situation and political uncertainty though. Expectations are for a lot of pain ahead for the UK economy which means the fundamental outlook remains bearish. But with a lot of bad news priced, we’re looking for shortterm upside opportunities.
USD
FUNDAMENTAL OUTLOOK: BULLISH
BASELINE
The Fed is on a data-dependent (meeting-by-meeting) policy stance, meaning incoming growth, inflation and jobs data remains a key driver for short-term USD volatility where we expect a cyclical reaction for both the USD and US10Y (good data expected to be supportive for the USD and US yields while bad data is expected to pressure the USD and US yields). The Fed is still under pressure to continue hiking rates and ramping up QT, but last week’s decent deceleration in the OCT CPI report has given markets some solace from inflation angst. Money markets shed about 30bsp off the implied terminal rate. As a result of this the USD saw intense selling but has largely stabilized this week. Like we’ve said many times, right now is all about the data. The data will lead the Fed, which means the data is what we should follow for high probability short-term directional flows for the USD. In the week ahead, we have a few of important data points such as ISM Manufacturing PMI and NFP on Friday. However, also pay close attention to the scheduled speech from Fed Chair Powell on Wednesday.
POSSIBLE BULLISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely good growth, inflation or jobs data is expected to trigger short-term bullish reactions in the USD. If the cyclical outlook continues to weaken, the USD’s safe haven status still matters. Any incoming catalysts that increase deep recession fears and triggers strong moves lower in risk assets & bonds can trigger safe haven flows into the USD. With a lot priced for the Fed and USD, the bar is high for hawkish Fed surprises, but any aggressive Fed speak talking up a >5.5% terminal rate can trigger further USD upside. The speech from Fed Chair Powell will be important. If he delivers the same stern hawkish tone that accompanied the prior FOMC presser, it can provide upside for the USD.
POSSIBLE BEARISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely bad growth, inflation or jobs data is expected to trigger short-term bearish reactions in the USD. If the cyclical outlook starts to improve, the USD’s safe haven status still matters. Any incoming catalysts that decrease deep recession fears and triggers strong moves higher in risk assets & bonds can trigger safe haven outflows out of the USD. With a lot priced in for the Fed and the USD, it won’t take much to disappoint on the dovish side. Any big concerns about growth from Fed speakers could trigger outflows.
BIGGER PICTURE
The fundamental outlook for the USD remains bullish as long as the Fed stays aggressively hawkish and cyclical concerns put pressure on risk sentiment. However, it’s also important to remember that the data leads the Fed. That means, even though the USD remains fundamentally bullish in the currency negative cyclical environment, it’s short-term direction will largely be determined by the incoming data. Thus, in the current context, we prefer trading the USD in the short-term with scalps out of key US economic data points.
SHORTING GBPUSD For the short term LOLKey:
Orange bars= Take profit Areas
Blue bars= Key areas
Overview
For the long term I believe that this pair is going to be bullish. However, in the short term I think that there could be an opportunity to hop on and get in on the retrace down to the 1.1930 levels, because that is the last place where price stopped at, and it also lines up well with the Fib-retracement tool.
The Plan
Currently price is in a mini consolidation. I am going to wait for price to break and retest my lower key level (1.2060) before getting in for a Sell down 1.1930, the orange lower level.
Plan B
If you fail to plan you plan to fail . In the case that price doesn't break my lower key area , it could go long. If it wants to go long I will wait for price to break and retest my upper key area (1.21500) before getting into a buy up to 1.2250.
* I have also set up alerts around my key areas so I can be ready for price when it gets there.
Information created and published by you on TradingView is not prohibited, doesn't constitute investment advice, and isn't created solely for qualified investors.
GBP USD - FUNDAMENTAL DRIVERSGBP
FUNDAMENTAL OUTLOOK: WEAK BEARISH
BASELINE
A looming recession has been a key source of Pound weakness and has kept pressure on Sterling despite ongoing BoE hikes. At their NOV policy decision, the BoE’s updated projections showed a deeper and longer recession than previously thought, as well as a stern push back against current market pricing for the high implied rate path. However, rate markets did not respond to this with only marginal downside in terminal rate expectations. With the new budget now out of the way, the markets should turn their attention to what this means for the economic outlook and means economic data & BoE policy should start to matter a bit more again. Unfortunately, the week ahead is extremely light so the main driver will probably be overall risk sentiment.
POSSIBLE BULLISH SURPRISES
With recession the base assumption, any incoming data that surprises meaningfully higher could trigger relief for the GBP. With focus on stagflation, any downside surprises in CPI or factors that decrease inflation pressures are expected to support the GBP and not pressure it. Any overly positive takes from BoE speak regarding the budget could be taken as a positive for Sterling.
POSSIBLE BEARISH SURPRISES
With recession the base assumption, any material downside surprises in growth data can still trigger short-term pressure. With focus on stagflation, any upside surprises in CPI or factors that increase more inflation pressures are expected to weigh on the GBP and not support it. Any overly negative takes from BoE speak regarding the budget could be taken as a negative for Sterling.
BIGGER PICTURE
The fundamentals for Sterling remain bearish with the UK already in a recession based on recent data. At least the new PM has provided some calm to the fiscal situation and political uncertainty though. Expectations are for a lot of pain ahead for the UK economy which means the fundamental outlook remains bearish. But with a lot of bad news priced, we’re looking for shortterm upside opportunities.
USD
FUNDAMENTAL OUTLOOK: BULLISH
BASELINE
The Fed is on a data-dependent (meeting-by-meeting) policy stance, meaning incoming growth, inflation and jobs data remains a key driver for short-term USD volatility where we expect a cyclical reaction for both the USD and US10Y (good data expected to be supportive for the USD and US yields while bad data is expected to pressure the USD and US yields). The Fed is still under pressure to continue hiking rates and ramping up QT, but last week’s decent deceleration in the OCT CPI report has given markets some solace from inflation angst. Money markets shed about 30bsp off the implied terminal rate. As a result of this the USD saw intense selling but has largely stabilized this week. Like we’ve said many times, right now is all about the data. The data will lead the Fed, which means the data is what we should follow for high probability short-term directional flows for the USD. In the week ahead, we have a few of important data points such as ISM Manufacturing PMI and NFP on Friday. However, also pay close attention to the scheduled speech from Fed Chair Powell on Wednesday.
POSSIBLE BULLISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely good growth, inflation or jobs data is expected to trigger short-term bullish reactions in the USD. If the cyclical outlook continues to weaken, the USD’s safe haven status still matters. Any incoming catalysts that increase deep recession fears and triggers strong moves lower in risk assets & bonds can trigger safe haven flows into the USD. With a lot priced for the Fed and USD, the bar is high for hawkish Fed surprises, but any aggressive Fed speak talking up a >5.5% terminal rate can trigger further USD upside. The speech from Fed Chair Powell will be important. If he delivers the same stern hawkish tone that accompanied the prior FOMC presser, it can provide upside for the USD.
POSSIBLE BEARISH SURPRISES
With the Fed signalling a data dependent policy stance, we expect a cyclical reaction from the USD with incoming US data. Thus, extremely bad growth, inflation or jobs data is expected to trigger short-term bearish reactions in the USD. If the cyclical outlook starts to improve, the USD’s safe haven status still matters. Any incoming catalysts that decrease deep recession fears and triggers strong moves higher in risk assets & bonds can trigger safe haven outflows out of the USD. With a lot priced in for the Fed and the USD, it won’t take much to disappoint on the dovish side. Any big concerns about growth from Fed speakers could trigger outflows.
BIGGER PICTURE
The fundamental outlook for the USD remains bullish as long as the Fed stays aggressively hawkish and cyclical concerns put pressure on risk sentiment. However, it’s also important to remember that the data leads the Fed. That means, even though the USD remains fundamentally bullish in the currency negative cyclical environment, it’s short-term direction will largely be determined by the incoming data. Thus, in the current context, we prefer trading the USD in the short-term with scalps out of key US economic data points.