GBP/USD is showing a flat dynamic on Wednesday, as market participants are waiting for new drivers. At 9:30 GMT the index of business activity of the British service sector, which occupies about 80% of the British GDP, will be published. In addition, the U.S. will release a report on durable goods orders and later in the evening, the minutes of the last FOMC meeting from which investors want to learn about the Fed's monetary policy outlook. At the moment the pair is trading near the level of 1.1900.
Many analysts after the latest inflation report suggested that the FOMC might ease monetary tightening in the US, as there is no point for the regulator to heighten the downtrend risks if the consumer prices are seen to be declining. According to experts, at the December meeting the Federal Reserve will raise the rate not by 75 but by 50 basis points.
Read more: What is the FOMC?
The index of durable goods orders in the USA is expected to grow by 0.4%.
The Organization for Economic Cooperation and Development (OECD) released a forecast according to which in 2023, the UK will be second after Russia in terms of the rate of economic slowdown. The British economy is expected to sag by 0.4% next year.
GBPUSD Technical analysis
The Bollinger Band indicator on the daily chart is in a strong growth phase.
The MACD indicator remains above the zero line, but it is steadily declining and has already generated a weak sell signal.
Oscillator stochastic is flying in the middle part of the working range.
After a confident breakdown and fixation of the price above resistance at 1.1933, we open long positions with Take Profit at 1.2133. Stop-loss is set at 1.1820.
In case of a confident breakthrough of support at 1.1800, we will start selling with nearest target at 1.1600. We will place a stop-loss at 1.1900.