GBP/USD remains in a downtrend and is developing a downward trend after the recent corrective growth.
Investors are actively selling sterling because of the novelties of the British government in the field of fiscal policy which create additional burden on the British budget.
On September 22, the Bank of England said that after the economic downturn in the first and second quarters, the economy entered a technical recession. However, this did not prevent the regulator once again raise the interest rate on fears of rising inflation to a record high of 11%.
The finance minister presented to the House of Commons a plan to cut taxes on individuals to help households in the energy crisis on the eve of the heating season.
The U.K. retail price index was released today. The index rose 5.1% in August
GBP/USD Technical Analysis
Bollinger indicator is showing a steady decline without any signs of a change in direction.
MACD indicator is holding a strong sell signal.
The stochastic oscillator from the bottom up has broken through the 20% level and came out of the oversold area.
In case of a confident break-down of the support at 1.0660, buy short positions with the target at 1.0274. We will place a stop loss at 1.0750.
In case of a rebound from 1.0600 we expect breakdown and fixing of the pair above resistance 1.0750. From here we form long positions with Take Profit at 1.1060. Let's place a protective stop at 1.0600.
More about GBP/USD trading
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