Fundamental Analysis – Carney’s speech will be scrutinized by the market
Mark Carney will be put to test once again when he will deliver his speech which is due later today. Given that the country has not only escaped its triple dip recession, but also has raised its GDP forecast, there are some serious expectations that Mr governor will deliver forward guidance for the sterling economy. The market will certainly scrutinize the contents of his speech however, giving a forward guidance may not be that easier for the governor, given that the country has a string of improving economic data. Moreover, the chatter continue about further QE so that the bank can keep the rates low, but if such chatter can be implemented remains a different question because it could be a massive challenge for the officials when the economic data is giving an evidence of an improving economy, and to maintain the Bank’s mandated inflation target.
Technical Analysis – GBP/USD- Fell from its Resistance as predicted- What Now
The GBP/USD pair fell from its resistance on a 30 minute time frame as predicted. This resistance zone was given in our analysis on 16th of August. The pair has also broken its upward trend line which confirms that the upward trend has lost its momentum and this trend line has acted as a resistance line. The price is also trading in a downward wedge pattern has not broken on either side of this pattern confirming that the down trend is still in play.
The GBP/USD is also trading below the 50 day (shown in green) and 100 day (shown in yellow) moving averages which confirm that the bears in full control.
The RSI is trading in line with the price action which confirms that the bias could be still to the upside.
1.5749- 1.5717 Minor