Source: PaxForex Premium Analytics Portal, Fundamental Insight
UK Construction Output Seasonally Adjusted for July decreased by 0.5% monthly and increased by 2.8% annualized. Economists predicted a contraction of 0.5% and an expansion of 2.9%. Forex traders can compare this to UK Construction Output Seasonally Adjusted for June, which increased by 1.6% monthly and 4.6% annualized.
The UK GDP for July decreased by 0.5% monthly, rose 0.2% for the three-month-over-three-month period ending in July and was flat at 0.0% annualized. Economists predicted a decrease of 0.2%, an increase of 0.3%, and 0.4%. Forex traders can compare this to the UK GDP for June, which rose by 0.5%, accelerated by 0.2% for the three-month-over-three-month period ending in June, and increased by 0.9% annualized.
UK Index of Services for July increased 0.1% monthly. Economists predicted a rise of 0.2%. Forex traders can compare this to the UK Index of Services for June, which expanded by 0.1% monthly.
UK Industrial Production for July dropped by 0.7% monthly and rose by 0.4% annualized. Economists predicted a contraction of 0.6% and an expansion of 0.5%. Forex traders can compare this to UK Industrial Production for June, which accelerated by 1.8% monthly and 0.7% annualized. UK Manufacturing Production for July contracted by 0.8% monthly and increased by 3.0% annualized. Economists predicted a drop of 1.0% and a rise of 2.7%. Forex traders can compare this to UK Manufacturing Production for June, which rose by 2.4% monthly and 3.1% annualized.
The UK Visible Trade Balance for July came in at -£14.060B, and the UK Trade Balance Non-EU at -£2.360B. Forex traders can compare this to the UK Visible Trade Balance for June, reported at -£15.460B, and the UK Trade Balance Non-EU at -£2.770B.
The US CPI for August is predicted to increase by 0.6% monthly and by 3.6% annualized. Forex traders can compare this to the US CPI for July, which rose by 0.2% monthly and 3.2% annualized. The US Core CPI for August is predicted to expand by 0.2% monthly and by 4.3% annualized. Forex traders can compare this to the US Core CPI for July, which rose by 0.2% monthly and 4.7% annualized.
The forecast for the GBP/USD turned cautiously bullish after this currency pair corrected into its horizontal support area. The Kijun-sen and the Tenkan-sen shift gradually lower but have lost their downside momentum. Adding to signs of increased volatility is the widening Ichimoku Kinko Hyo Cloud, as bulls and bears face off at a key support level. Traders should monitor the CCI after forming a positive divergence in extreme oversold territory. A sustained breakout above -100 could trigger a rally from depressed levels. Can bulls overpower bears and push the GBP/USD into its horizontal resistance area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the GBP/USD remain inside the or breakout above the 1.2390 to 1.2500 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.2455
- Take Profit Zone: 1.2740 – 1.2800
- Stop Loss Level: 1.2370
Should price action for the GBP/USD breakdown below 1.2390, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.2370
- Take Profit Zone: 1.2260 – 1.2310
- Stop Loss Level: 1.2390
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