Ukbudget — Trading Ideas on TradingView

FTSE100 post-Budget rally: Inverse Head & Shoulders eyes 9800 Chancellor Reeves unveiled tax rises worth £26 billion annually by 2029-30 but showed fiscal discipline by committing to reduce government spending as a share of GDP each year and more than doubling the fiscal headroom buffer to £21.7 billion, reassuring bond markets still scarred by the Liz Truss mini-budget crisis. With gilt yields falling, sterling at its best level since October, and a Bank of England rate cut expected in December, the macro backdrop supports further upside for Footsie, though sticky inflation and OBR growth downgrades remain headwinds. Key drivers: UK Budget introduces tax rises totalling £26bn annually by 2029-30 via threshold freezes, mansion tax, and dividend levies, but spending will decline as a share of GDP each year, calming government borrowing concerns and sending gilt yields lower. Fiscal headroom buffer more than doubled to £21.7bn (from £9.9bn last year), giving bond vigilantes confidence that the debt trajectory is sustainable. Sterling rallied above 1.32 towards 1.33 on lower borrowing risks, while FTSE 100 gained, led by financials. Bank of England expected to cut rates 25bp in December, supporting equities, though sticky inflation and OBR growth downgrades are headwinds. Technical setup : inverse head and shoulders with neckline/support at 9,630 (38.2% Fib), measured move and Fib confluence target 9,800 (between 61.8% and 78.6% retracement). Trade idea : Entry on pullback to 38.2% Fib (9,630), stop below previous low (9,434), target 9,800, for 2:1+ risk-to-reward. Trading the FTSE bounce? Drop your setups in the comments and follow for more high-action technical and macro trade ideas. This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.

09:45

GBPUSD | Opportunities Before UK Autumn Budget Data Macro approach: - The pound appreciated against the US dollar as markets focus on the UK Autumn Budget and shifting expectations for US data and Fed policy this week. - The UK Autumn Budget is the key event, with uncertainty over possible tax rises and spending cuts undermining confidence and keeping the pound under pressure. Recent data showing UK inflation easing to about 3.6% in Oct has boosted expectations of a BoE rate cut in Dec, which also weighs on the pound. - On the US side, expectations for a Fed rate cut in Dec have climbed to 80%, putting downward pressure on the US dollar and US yields. - Contrarian view: while the upcoming UK Autumn Budget (scheduled for 26 Nov) is a significant risk, the negative sentiment may have been fully "priced in" by earlier declines. Markets are in a "wait-and-see" mode. The lack of fresh negative news today has allowed the pound to stabilize and edge higher as traders square positions before the actual budget announcement. Technical: - GPBUSD is retesting the broken descending trendline, which is slightly above the key support at 1.3100. The price is between both EMAs, awaiting a clear breakout to determine the short-term trend. - If GBPUSD breaches above EMA78, the price may continue heading toward the following resistance at 1.3215. - Conversely, closing below the key support at 1.3100 may prompt a downward momentum to retest the previous swing low at 1.3040. Analysis by: Dat Tong, Senior Financial Markets Strategist at Exness

EURGBP tests 0.88 as UK Budget crisis deepens: Where next?The dollar crushed all majors yesterday, but EURGBP tells a different story. The euro is surging against the pound as UK fiscal chaos and bets on a BOE rate cut accelerate. With an ascending triangle breakout confirmed, traders are targeting 0.89 and the psychological 0.90 handle. The Office for Budget Responsibility just revealed a £20 billion fiscal hole, forcing Chancellor Reeves to make tough choices in November's budget. Meanwhile, markets price 68% odds of a December BOE rate cut as inflation cools—two mega catalysts for GBP weakness. Key drivers UK fiscal crisis: £20 billion productivity forecast slash ahead of November 26 budget forces austerity measures, crushing pound confidence BOE rate cuts priced In: 68% December cut odds versus 30% November (food prices down 0.4% month-on-month, retail deflation for first time since March) Technical breakout: Ascending triangle break above 0.8800 opens clean path to 0.89 and 0.90; golden 61.8% Fibonacci sits at 0.8872 as magnet level Wedge pattern risk: Multiple Fibonacci clusters (0.89, 0.8876, 0.90) confirm upside targets, but final wave of rising wedge warns of sharp retracement after targets hit How to trade EURGBP? Long above 0.8775, target 0.8872 (golden Fib magnet) then 0.89-0.90. Stop below 0.8750. Watch BOE communications and November 26 budget details for confirmation. UK in crisis mode—don't fade the breakdown. This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.

07:49

GBPUSD: Cable slides under 1.35 handle after triple blow!Cable faces a crucial test at 1.3500 following yesterday's triple blow from disappointing UK PMI data, hawkish comments from Powell, and concerning UK public sector borrowing figures ahead of November's Budget. In this ThinkMarkets analysis, we break down the key technical levels as GBPUSD loses the round 1.3500 support but remains within its upward channel. Key focus areas : Immediate Risk : Break below channel support targeting 1.3372 double bottom Critical Level : 1.3335 - invalidation of inverse head & shoulders pattern Fibonacci Support : 61.8% retracement cluster around 1.3340 Trading Strategies : Three approaches for the potential breakdown Key Levels to Watch : Support : 1.3500 (breaking), 1.3450, 1.3372, 1.3340 Resistance : 1.3550 bounce target Bias : Cautiously bearish while below channel support The pound continues to face domestic headwinds with stalling economic data and fiscal concerns, making any recovery challenging despite potential Fed dovishness. Cable traders, watch this critical technical juncture closely. Trade responsibly with ThinkMarkets - your trusted forex partner. This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.

07:19

Pound plummets below 1.34 amid UK gilt turmoil! What's next?The Pound is under heavy pressure, trading around 1.3382 after falling below the critical 1.3400 mark. The trend is bearish, with price action contained in a downward channel and repeated failures to break key resistance levels. Fundamental Drivers UK Gilt Yields : 30-year yields have surged to their highest since 1998, raising concerns about the sustainability of UK public finances. Political Uncertainty : A recent cabinet reshuffle by the Prime Minister has heightened fiscal fears, with risks of tax hikes or spending cuts. Inflation & BoE Policy : Persistent inflation and the Bank of England’s reluctance to cut rates undermine confidence in the Pound. US Dollar Strength : The Dollar is strong, especially ahead of the US Nonfarm Payroll (NFP) report, adding further pressure on GBP. Bearish Scenario (Primary Outlook) Outlook : Continuation of the downtrend within the downward channel. Entry Conditions : Rejection at 1.3390–1.3400 resistance zone Risk Management : Move stop to breakeven after Target 1 Bullish Scenario (Counter-Trend Opportunity) Outlook : Short-term corrective bounce possible if key resistance is broken. Entry Conditions: Strong break above 1.3400 with volume Retest of 1.3390 as support RSI shows bullish divergence or breaks above 50 Risk Management : Take partial profits at each target, trail stops higher Important Notes Expect volatility around the NFP release and from ongoing UK political developments. Fibonacci levels around 1.3330–1.3300 provide strong support confluence. The failed inverse head & shoulders pattern favours the bearish case. The 1.3389–1.3390 zone is critical for both bullish and bearish setups. This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.

08:08

GBP/USD climbs after Bank of England cut rates The British pound has rebounded on Thursday. In the North American session, GBP/USD is trading at 1.2983, up 0.81% on the day. A day earlier, the pound took a drubbing, sliding 1.2%. There was no surprise as the Bank of England lowered the key interest rate by 0.25% to 4.75%. The markets had priced in the move at close to 100% and the Monetary Policy Committee voted 8-1 in favor of the cut, with one member voting to hold rates at 5%. The BoE has now lowered rates twice since its easing cycle in August. BoE policymakers had signaled that a rate cut was coming, as September inflation dropped sharply to 1.7%, the first time in over three years that inflation dropped below the BoE’s target of 2%. The central bank is expected to lower rates gradually in modest increments of 25 basis points in the coming months, but last week’s UK budget could complicate things. The budget included tax hikes and increased spending, which is expected to boost inflation. That could mean a pause at the next BoE meeting in December and a slower pace of rate cuts next year. The Federal Reserve meets later today, in the shadow of the dramatic US election, in which Republican Donald Trump cruised to a surprisingly easy victory over Democrat Kamala Harris. The Fed is virtually certain to trim rates by 0.25% to 4.5%-4.75%. With inflation easing, the Fed is expected to continue its rate-cutting cycle into 2025. GBP/USD pushed above resistance at 1.2920 earlier and then tested resistance at 1.3007 There is support at 1.2793 and 1.2706

GBP/USD analysis: BoE hikes needed to curb gilts' term premium Finally unveiled, the UK government's Autumn Budget was conservative and cautious, in line with market expectations. A fiscal consolidation of £55 billion has been announced, to be split evenly between more taxes and lower spending. From the next year until 2028, windfall taxes on oil and gas companies will increase from 25% to 35%, while the Energy Price Guarantee programme (EPS) has been revised to cut down on government spending. These two measures dominate the UK's fiscal adjustment. But now that the threat of losing the anchor of fiscal credibility has ended, sterling investors are once again confronted with the reality of the UK economic outlook. Inflation is expected to average 7.4% in 2023, but GDP will shrink 1.4% due to the recession. A higher and more persistent inflation rate requires the Bank of England to maintain its restrictive stance for a longer period of time. Furthermore, the longer inflation stays high, the more difficult it will be for gilts to lure buyers to these negative real yields, especially since the BoE will restart quantitative tightening in late November. GBP/USD has risen from 1.036 to 1.203 following the reversal of September's mini-budget, primarily due to lower gilt yields, as recovered market confidence in fiscal policy has stimulated demand for UK sovereign bonds. Gilt yields likely bottomed out before the UK Autumn Budget, as the market had largely anticipated the fiscal consolidation, and could now resume a natural upward repricing, not in a disorderly fashion, but adequately to reflect a high inflation/high interest rate environment. The outlook for the pound is now dependent on the Bank of England's policies. Hawkish BoE = Neutral/bullish scenario for the pound If the BoE turns out to be more hawkish than expected – markets are currently pricing in 60bps in December and terminal rate of 4.5% next year – it can better control inflationary expectations and pressures. In this scenario, UK interest rates will increase quicker than UK 10-year gilt yields, limiting the term premium and enhancing policy credibility. This is a favourable scenario for the pound, as it can restrict the downside and discourage speculators from shorting a currency with a high yield. Dovish BoE = Bearish scenario for the pound In contrast, if the BoE delivers fewer rate hikes than the market currently predicts, inflation expectations will not be restrained and long-term gilt yields would rise faster than UK interest rates, effectively placing downside pressure on the pound.