This week, absolutely market focuses on FED Meeting on Wednesday, but UK data and Sterling are also important.
Like I said in E/U analysis and in my page, I believe FED will hike rate and refuse to provide a clear path of next hike, it means I choose bias for Dollar.
UK data this week:
- UK CPI
- UK employment report.
- UK Retail Sales.
If UK CPI on Tuesday is postive , Retail Sales on Thursday is also positive and vice versa : This is basic analysis. UK Employment report is released on Wednesday; this day market pays attention on FED Meeting, I ignore UK employment report. Hence, we only take care UK CPI . The problem is performance of UK data last month were not good as market's expectation, so it's hard to have positive CPI .
However, that is not my primary concern. surely, FED would hike rate, but who will follow FED ? It's only BOE.
BOE is expected the second thinking about liftoff, so when FED is over, market comes back BOE and pricing for Sterling.
Hence, I think there is a lot of room to LONG GBPUSD .
There is no obvious resistance and support levels around current level of G/U. so it's hard to place stop loss and take profit also a good point to entry.
However, I see an interesting point. SMA100 + SMA200+long term descending converge at one point around 1.5330
It's also 2 month high and the ceiling of Kumo cloud.
If GBPUSD breaks long term descending , this will trigger a strong rally of G/U, I expect this will happen.
Finally, I will BUY GBPUSD to 1.5330 and further to 1.5500