- GBP/USD bulls are in the market ahead of the central banks.
- Bulls are the front side of the bullish trend leaving the bias bullish near and longer term.
GBP/USD is grappling with the 1.22 area on Tuesday, keeping close to an almost seven-week high as traders reckoned banking stress could keep the Federal Reserve and the Bank of England from hiking rates much further.
The pair is on the front side of the bullish trend as we head into the central bank meetings this week and a multi-timeframe analysis determines a bullish bias for both the near-term and longer term as follows:
GBP/USD H1 chart
From an hourly perspective, the bulls are in control but the recent drop leaves prospects of some consolidation for the foreseeable sessions into the Federal Reserve event on Wednesday.
GBP/USD monthly chart
Zooming all the way out, the monthly chart shows that the market broke structure near 1.2245 but failed to hold above. The correction was relatively shallow so there are risks of a deeper move into the Fibonacci scale to at least test the 1.1650s and a 38.2% ratio. With that being said, there is just as much chance that the bulls will stay committed.
GBP/USD weekly charts
Afterall, on the weekly chart, the bear trend was broken and support has held so far.
This leaves an upside bias for the weeks ahead.
The price is in a box and there are equal highs and lows on both sides with liquidity above and below. However, the bullish bias persists while the price is on the backside of the prior bearish trend and in a phase of accumulation.
GBP/USD daily chart
There are also inverse head and shoulders on both the daily and 4-hour charts.
GBP/USD H4 charts
The 4-hour chart´s H&S´s neckline is already broken.
The M-formation is a reversion pattern and the price is being supported on the front side of the bullish trend.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD consolidates around 1.0760 ahead of US CPI Premium
EUR/USD is consolidating near 1.0750 and the DXY holds above 104.00. The cautious market mood helps the US Dollar remain steady as investors gear up for crucial macroeconomic data releases and central bank meetings. The US Consumer Price Index is due on Tuesday.
GBP/USD steady around 1.2550 as attention turns to US inflation
GBP/USD rebounded after finding support at the 1.2540 area and climbed toward 1.2570, on a quiet session. October labor market data from the UK and November inflation data from the US will be released on Tuesday ahead of the Fed's and the BoE's policy meetings.
Gold extends daily slide toward $1,980 Premium
Gold price remains under heavy bearish pressure and trades at its lowest level in nearly three weeks at around $1,980. The benchmark 10-year US Treasury bond yield is up more than 1% on the day, weighing on XAU/USD ahead of this week's key macroeconomic events.
Bitcoin price backtracks to $40,000 as whales move to sell $671 million worth of BTC
Bitcoin price crashed on Monday for the first time in nearly three weeks. The market was expecting a bullish continuation until the Securities & Exchange Commission (SEC) approves a spot BTC ETF in January 2024.
S&P 500 Forecast: Index produces new 2023 high
The S&P 500 index launched itself just barely to a new high for the year on Monday. In its second hour of trading, the index reached 4,620, which was just above the earlier annual high of 4,607 from July 27.