The US dollar weakened against most major currencies in a strong currency basket as the Federal Reserve urgently cut interest rates to 50 basis points. Positive reports of the US economy have not had a very optimistic impact on the greenback in the context of low interest rates that have overwhelmed investors' expectations.
This week, investors will focus on the Bank of England's interest rate decision on Thursday. The market is assuming that around 60% of the BOE chance will drop by 25 basis points on the standard lending rate. If this happens, the pressure drop will weigh on the pound.
On the technical chart, after breaking down the down trend trend from 1.3209 to 1.3017, the GBPUSD currency pair rose more than 170 points to the highest level of 1.3123 in the first session of the week.
Combined with these fundamentals, it is likely that GBPUSD will have a rally to Demand 1.282 and test the downward trendline before gaining further momentum. The rally target is in the 1.333 zone
In case GBPUSD breaks the rising trendline line from 1.1957 to 1.2725, a fall will form with the target towards 1.233.
Stop loss 1,272
Profit taking 1.317
Recommendation: This is just a Trading Idea. For more accurate analysis, you should incorporate other indicators that you have mastered. In particular, always focus on capital management methods to prevent any possible market situation.
Author: Nguyen Chi Thanh
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