[ad_1]
The GBP/USD pair rebounded in the overnight session as investors embraced a risk-on sentiment even as the war in Israel continued.
Forex Brokers We Recommend in Your Region
See full brokers list 
- Buy the GBP/USD pair and set a take-profit at 1.2350.
- Add a stop-loss at 1.2150.
- Timeline: 1-2 days.
- Set a sell-stop at 1.2200 and a take-profit at 1.2100.
- Add a stop-loss at 1.2300.
The GBP/USD has crawled back in the past few days as the recent US dollar strength took a breather. Sterling rose to a high of 1.2233 on Tuesday, higher than last week’s low of 1.2038.
The GBP/USD pair rebounded in the overnight session as investors embraced a risk-on sentiment even as the war in Israel continued. The US dollar pulled back while American equities rose, with the Dow Jones and the S&P 500 adding over 0.60%.
This price action came after Philip Jefferson, the Fed vice chair noted that the bank would proceed carefully with the forthcoming rate decisions. He noted that the bank was aware of the tightening of financial conditions.
His statement was echoed by that of Lorie Logan, the head of the Dallas Federal Reserve. She said that the bank could be forced to do less in terms of rate hikes. Other Fed officials like Christopher Waller, Raphael Bostic, and Neel Kashkari will speak on Tuesday.
The Fed has embraced a hawkish tone since 2022 in a bid to fight the elevated inflation. It has moved them from 0% to between 5.25% and 5.50%. Along the way, the Fed has pushed bond yields to the highest level in decades.
The GBP/USD pair will next react to the upcoming Federal Reserve minutes. These minutes will provide more information about the last meeting. In it, the bank decided to leave rates unchanged and signaled that it would deliver another increase in October.
The next key data to watch will be the upcoming US consumer price index (CPI) data. Economists polled by Reuters expect the data to show that the headline inflation retreated to 3.6% in September even as gasoline prices jumped.
The GBP/USD pair has bounced back in the past few days. In this period, it has risen from this month’s low of 1.2035 to a high of 1.2240. It has formed an ascending channel and flipped the resistance at 1.2110 (September 27th low) into a support.
The pair has also risen above the 25-period and 50-period moving averages while the Stochastic Oscillator has drifted upwards. Therefore, the pair will likely continue rising in the coming days. This view will be confirmed if this price moves above the resistance at 1.2270 (September 29th high).
Ready to trade our free daily Forex trading signals? We’ve shortlisted the best UK forex broker in the industry for you.
[ad_2]