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GBPUSD Market Update

8/11/2022 1:10 PM

Due to the depreciation of the American currency, the GBP/USD pair is correcting around 1.2191, but there are practically no prospects for strengthening the pound.

According to Bloomberg, the UK economy is heading towards an expected recession as household debt hits new lows: electricity bills hit an all-time high of 1.3B pounds, and about 6.0M households have an average debt of 206.0 pounds, and this number is increasing every day. Even more serious concerns are the planned price increase, expected at the beginning of winter: as experts suggest, every third family may be unable to cope with the new tariffs.

The US dollar fell below 106.000 in the USD Index and almost hit 105.000. The reason for the negative dynamics was the statistics on the consumer price index, which, according to data for July, decreased in annual terms to 8.5% from 9.1% a month earlier. While the decline in inflation is undoubtedly a positive factor, investors fear that the US Federal Reserve will reconsider its strategy of raising interest rates and may abandon the "hawkish" plans to adjust monetary policy parameters, changing the rate at the next meeting in September to 25 or 50 basis points instead of 75 basis points.

The trading instrument is moving within the global downward channel, coming close to the resistance line. Technical indicators, which have slowed down a bit lately, once again began to strengthen the signal to buy: indicator Alligator's EMA oscillation range is expanding upwards, and the histogram of the AO oscillator is forming rising bars in the buying zone.

Resistance levels: 1.2289, 1.2652. | Support levels: 1.2067, 1.1757.

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