GBP/USD Forex Signal
Bullish view
Buy the GBP/USD pair and set a take-profit at 1.2300.
Add a stop-loss at 1.2100.
Timeline: 1-2 days.
Bearish view
Set a sell-stop at 1.2180 and a take-profit at 1.2050.
Add a stop-loss at 1.2250.
The GBP/USD forex rate has been rising in recent days as investors digested important economic data. It reached a high of 1.2242 last week, the highest since December 19. As the US dollar index fell from $115 in 2022 to $102, the pair has been strongly bullish.
Inflation and retail sales figures for the United Kingdom
The GBP/USD exchange rate rose after the United States released its inflation data last Thursday. According to the Bureau of Labor Statistics (BLS), the country's inflation continued to fall in December. It has fallen for six months in a row, and some analysts are concerned about the possibility of deflation in the United States as the economy undergoes significant change.
Inventories remain high amid recessionary fears. Despite recent positive data, including employment, some economists believe the US economy will contract in 2023. According to a Wall Street Journal poll of economists, the likelihood of a recession has risen to 61%. Top Wall Street banks' financial results indicated that they expected a mild recession.
The GBP/USD pair rose after the release of the most recent UK GDP data on Friday. These figures showed that the economy eked out a small gain in November, defying analyst expectations. It grew by 0.1% in November, beating expectations of a 0.2% contraction. In the third quarter, the economy shrank by 0.3%.
The GBP/USD exchange rate will react to upcoming UK economic data. The Bureau of Labor Statistics (BLS) will release the most recent job figures on Tuesday. On Tuesday, the latest UK inflation figures will be released. Economists predict that inflation will fall slightly in December, as it did in the United States.
Forecast for the GBP/USD
The GBP/USD has been rising in recent days. It has managed to move above the 25-day and 50-day moving averages during this time. It also rose slightly above the key resistance level of 1.2200, which was the highest point on January 9. The pair also passed above the upper side of the descending channel and the Ichimoku cloud.
As a result, the pair is likely to see a bullish breakout this week as the UK releases important economic data. If this occurs, the pair is likely to continue rising as buyers aim for the key resistance level of 1.2300