Fundamental
Overview
Yesterday, the US Consumer Confidence report surprised to the downside
with one of the largest drops since 2021. The labour market data in the report
softened a lot and it generally leads the unemployment rate.
The market responded by
raising the probabilities for the Fed to cut by 50 bps in November to roughly
60%. The question now is whether this is just about the low hiring rate or
something worse. We will have to wait for the NFP report next Friday.
On the GBP side, the UK
PMIs on Monday were a touch softer than expected but still solid compared
to its peers. The market expected the BoE to deliver at very least another 25
bps cut in November.
GBPUSD
Technical Analysis – Daily Timeframe
GBPUSD Daily
On the daily chart, we can
see that GBPUSD extended the gains above the 1.34 handle before giving back
some today. If we were to get a bigger pullback, the buyers will likely step in
around the support
zone around the 1.3265 level where we can also find the 38.2% Fibonacci
retracement level for confluence.
The sellers, on the other hand, will want to see the price breaking lower to
increase the bearish bets into new lows.
GBPUSD Technical
Analysis – 4 hour Timeframe
GBPUSD 4 hour
On the 4 hour chart, we can
see that we have a trendline defining the current bullish
momentum. If we get a pullback, the buyers will likely lean on the trendline
with a defined risk below it to position for the continuation of the uptrend.
The sellers, on the other hand, will want to see the price breaking lower to
increase the bearish bets into new lows.
GBPUSD Technical
Analysis – 1 hour Timeframe
GBPUSD 1 hour
On the 1 hour chart, we
have another minor trendline defining the bullish momentum on this timeframe. Again,
the buyers will likely lean on it to position for new highs, while the sellers
will look for a break lower to target a fall into the next trendline. The red
lines define the average daily range for today.
Upcoming
Catalysts
Tomorrow, we get the latest US Jobless Claims figures, while on Friday, we
conclude the week with the US PCE.