Fundamental overview of the cable
The outlook for the pound remains cautious. Analysts point to upcoming UK employment and average earnings data as key indicators that could influence the Bank of England’s (and the pound’s dollar’s) future interest rate decisions. A rise in wage inflation could put pressure on the BoE to maintain a tighter monetary policy than currently anticipated.
Furthermore, with the US Consumer Price Index (CPI) data and the FED rate decision this week, volatility on the Pound Dollar is expected to increase. Investors will be closely monitoring both economic data and central bank statements to adjust their trading strategies.
Technical Analysis and Pound Dollar Forecasts
At the time of writing, the price of the cable was trading at 1.2713, down by 0.06% and in full attempt to confirm the reversal after having almost reached the key level of 1.2800. From now on the bears will try to close below 1.2700 to lay the foundation for a new bearish start, with the yearly level 1.2632 representing the first bearish target. A break above it would allow the pound-dollar to reach the next annual level of 1.2474.
On the upside, only with a close above 1.2750 will the bulls re-enter the scene, with the key 1.2800 level and the 1.2827 yearly level representing the two main short-term LONG targets. Once the annual level has been exceeded, it cannot be ruled out that the pound/dollar will be near the highs of June 2023, around the annual level of 1.2969.
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