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- Sell the GBP/USD pair and set a take-profit at 1.2310.
- Add a stop-loss at 1.2480.
- Timeline: 1-2 days.
- Set a buy-stop at 1.2450 and a take-profit at 1.2550.
- Add a stop-loss at 1.2350.
The GBP/USD exchange rate moved sideways after the strong US consumer confidence and housing data. The pair was trading at 1.2400, which was a few points above this month’s low of 1.2306. Focus will now be on the US debt ceiling news and the upcoming Fed’s Beige Book.
The GBP/USD pair moved sideways after the latest American consumer confidence and house price numbers. Data from Conference Board showed that the country’s consumer confidence dropped to 102.3 from the previous 103.7. This decline was better than the median estimate of 99.0.
Meanwhile, the house price index rose for the second straight month, signaling that the sector is in a recovery mode. The index rose by 0.6% in March from the previous 0.7%. Economists were expecting that the index rose by 0.2% in February.
On a year-on-year basis, the index jumped by 3.6%, higher than the estimated 2.4%. Therefore, despite the rising interest rates, these numbers mean that there is still more demand for houses in the US.
The Fed will publish its Beige Book report later on Wednesday. This is an important report published eight times a year that provides important commentary on the economy. It will also provide some hints about what to expect in the coming meetings.
Analysts believe that the Fed could decide to deliver another rate hike in June. Data published on Friday showed that the American PCE index jumped by 4.7% in May, This PCE is higher than the Federal Reserve target of 2.0%.
The US will publish the latest JOLTs job openings report. Economists expect that the report will come in at 9.775 million in April from the previous 9.59 million.
The GBP/USD price drifted upwards to a high of 1.2441 on Tuesday, higher than this month’s low of 1.2310. It has moved slightly above the 50-period moving average while the MACD has jumped above the neutral point. The pair has jumped above the key support level at 1.2345, the lowest point on April 10.
The pair will likely resume the bearish trend in the next few days and retest last week’s low of 1.2300. A move above the key resistance point at 1.2500 will invalidate the bearish view.
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