Instead of pulling back to 1.22 - which would be expected from a continued consolidation that started last October - GBP/USD is drawn to 1.25.
Interesting that GBP/USD is currently negatively correlated with the US stock market, and has been since Trump’s election (bottom chart).
Growing concerns with the US will favour GBP/USD, as too will concerns that inflation in the UK, now at 2.3% is over the 2% target and a rate rise becomes likely. We favour being long GBP/USD, and increasing even more above 1.28.
Interesting that GBP/USD is currently negatively correlated with the US stock market, and has been since Trump’s election (bottom chart).
Growing concerns with the US will favour GBP/USD, as too will concerns that inflation in the UK, now at 2.3% is over the 2% target and a rate rise becomes likely. We favour being long GBP/USD, and increasing even more above 1.28.
Note
Theresa Mays call for a snap election today is received well by the markets, adding fuel to this pro GBP trade.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.