Trading idea for GBP/USD on March 28, 2024
On Thursday morning, GBP/USD continues to decline, approaching the support of 1.2600. The pair is retreating further from the high of 1.2893 amid the strengthening of the US dollar and weak UK economic indicators.
The dollar is still helped by rumors that the Fed will not rush to ease monetary policy. The American economy is still stable, which allows the regulator to maintain a "hawkish" position. In addition, the Federal Reserve takes into account the high risks of a new round. According to the FedWatch Tool, the probability of a rate cut in June is 60%.
Tomorrow, traders will analyze data on the personal consumption index in the United States in February. Forecasts suggest an increase in the index from 2.4% to 2.5% (YoY). The implementation of the forecast may further reduce the likelihood of monetary expansion in June, which will undoubtedly support the dollar.
In turn, the Bank of England at its meeting in March demonstrated an even more cautious approach to changing the course of monetary policy. Investors believe that the British regulator will act later than the Fed.
Today, investors' attention is focused on the final US and UK GDP data for the fourth quarter of 2023. It is likely that the US GDP data will remain unchanged at 3.2%, while the British data is likely to disappoint again. Thus, UK GDP decreased by 0.2% year-on-year and 0.3% quarter-on-quarter, indicating a recession in the economy. This increases the pressure on GBP/USD. We are considering new forex orders for the sale of an asset
- Sell-stop 1.2570
- take profit at 1.2400
- stop loss at 1.2650.