Short Buy (I believe the Trend will continue)
The US Dollar (via the DXY Index) has once again rebounded from rising trendline support from the May 2021 and January 2022 swing lows.
Receding Omicron fears assisted GBP/USD to gain some positive traction on Monday.
A goodish pickup in the USD demand kept a lid on any meaningful gains for the major.
The year-end thin liquidity conditions warrant caution before placing directional bets.
“Omicron to make BoE more cautious over raising rates in near-term. A decision to leave rates on hold next week is better priced now which should help dampen negative GBP reaction. Dropping guidance for rate hikes in the coming months would be a bigger bearish surprise for GBP.
The timing of lift-off for rate hikes by the BoE and Fed appears to be narrowing...
GBPUSD Bears seeking a break of key support at the 1.3400 area that has become a critical level. A break lower could trigger more losses, exposing the November low at 1.3351. The recovery faced resistance around 1.3500/10. The bearish bias will likely remain intact while under 1.3600.
