GBP/USD Forecast: Rallies after CPI Numbers

The question at this point is whether or not we continue to rise, but right now I’d say the odds are probably in the bulls’ favor. GBP/USD rose to , in Thursday’s trade following a CPI exit from the US. To be fair, the numbers were exactly what people expected, so I think that alleviates some of the fear that the Fed is being too crazy. After that, there’s still a lot of confusion about what the Fed is going to do, so you have to be very careful about being too aggressive one way or the other. At the end of the day, I think it’s a situation where the question now is whether they’re going to raise the rate 25 basis points in February or whether it’s going to be 50 basis points. That’s what everyone is asking, and that’s why everyone pays close attention to potentially noisy notifications. Advertisement image Take advantage of today’s market opportunities TRADE NOW Inflation is still at 6.5% per year, which is unheard of. However, there have been whispers in the market a few times about a lower than expected rate, so much of it may already be baked into the price. That said, this is a market that has definitely been on the rise recently, so it makes sense that we will eventually break out. Avoid investing heavily in this market At this point you have to question whether or not we will continue to go higher, but right now I would say the odds are probably in favor of the bulls. If we can break the 1.2 50 level, it is possible that the market could go up to the 1.25 level and then the 1.30 level. However, if the 200-day EMA were to remain below, it is possible that we could look at the level below 1.20 as a possible target. That said, this market is more likely than not to continue to see a lot of noisy behavior as there is a lot of concern about the UK economy. Overall, I think it’s a bit bullish, but I don’t expect any massive breakout anytime soon. So we may not have a short signal yet, so I’m neutral and a little bit up right now. I wouldn’t put a lot of money in this market right now.

Steve Walker

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