Type:
Bullish Rise
Key Levels:
Resistance: 1.2286
Pivot: 1.2161
Support: 1.2047
Preferred Case:
On the H4, with icpre moving along the ascending trendline and above ichimoku cloud , we have a bullish bias the price may rise from the pivot at 1.2161, where the 23.6% fibonacci retracement is to 1st resistance at 1.2286, which is in line with the 78.6% fibonacci retracement .
Alternative Scenario:
Alternatively, price could drop to the 1st support at 1.2047, which is in line with 50% fibonacci retracement .
Fundamentals:
The interest rate in the UK is at 1.25% with the recent rate increases from the BoE failing to have an impact on slowing inflation growth, as the UK CPI stands at 9.1%, a 4-decade high. The BoE is under pressure to take on a more aggressive approach in setting future policy rates. Gov Bailey indicated that the BoE could increase interest rates by 50bps as it attempts to address the issue of persistent inflation.
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Desmond Leong runs an award-winning research firm (The Technical Analyst finalists 2018/19/20 for Best FX and Equity Research) advising banks, brokers and hedge funds. Backed by a team of CFA, CMT, CFTe accredited traders, he takes on the market daily using a combination of technical and fundamental analysis.