GBP/USD Plunges Amid BOE Inflation Report

FXOpen

Cable inched lower against the greenback on Wednesday, decreasing the price of GBP/USD to more than 1.5870 amid Bank of England’s quarterly inflation report.

Technical Analysis

As opposed to trading session on Tuesday, today the market is overwhelmed with the bearish pressure. The pair opened the Asian session at 1.5916. As of this writing, the pair is being traded around 1.5857, gradually moving down to test a critical support around 1.5830. A successful breakout will lead the pair to test the next milestone at 1.5784.

gbp

On the upside, the pair may test the crucial resistance at 1.6000, the psychological number and the trend line resistance. The said level acted as resistance on many occasions during the last two weeks.

The overall bias is bearish because of lower lows on the daily chart. The bias is expected to remain bearish as far as the 1.6000 resistance area remains intact.

ILO unemployment Report

The ILO unemployment Report figure for this September is 6.0%, same as that of August while missing the 5.9% as forecasted by analysts. Indicating a shrinking economy, a high figure is considered bearish for the cable and vice versa. Thus a high reading spurred bearish momentum in the price of GBP/USD.

BOE Quarterly Inflation Report

The Bank of England has published the inflation report. The dovish sentiment of the report indicated weaker global growth and no clear indication about the first interest rate hike. The dovish statement spurred bearish momentum in the price of the GBP/USD.

Trade Idea

In the light of technical and fundamental outlook, buying the pair on the emergence of bullish pin bar or bullish engulfing candle could be a good strategy in short to medium term.

 

Trade global forex with the Innovative Broker of 2022*. Choose from 50+ forex markets 24/5. Open your FXOpen account now or learn more about trading forex with FXOpen.

* FXOpen International, Innovative Broker of 2022, according to the IAFT

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

EUR/USD Analysis: Key Support Zone Resists Selling Pressure USD/JPY Analysis: Rate Reaches Maximum of the Year Market Analysis: EUR/USD, GBP/USD, and USD/JPY Market Analysis: AUD/USD and NZD/USD Could Start Fresh Increase Market Analysis: American Currency Rises Sharply after Fed Meeting

Latest articles

Weekly Market Wrap With Gary Thomson: UK STOCK MARKET RISES, S&P 500 FALLS, OIL ANALYSIS, EUR/GBP

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights. UK stock market rises

Forex Analysis

EUR/USD Analysis: Key Support Zone Resists Selling Pressure

Today, fresh monthly values of the PMI index, which is considered a leading indicator of the state of the economy, have become known: France: actual 43.6, expected 46.2. This is the worst economic contraction since the coronavirus.Germany:

Forex Analysis

USD/JPY Analysis: Rate Reaches Maximum of the Year

This morning, the Bank of Japan's decision on the interest rate, which has been kept at -0.1% since 2016, became known. The rate size remained unchanged. Although surprises could occur due to the fact that inflation is still above

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.