$GBP - What shall we do now?

Updated

- What shall we do now?

GBP - Since we hit below 1.14 - 1.10 it's really been a one way for this pair and it could continue...However, we have options!

1 Emergency rate hike
2 Intervention
3 IMF
4 Fiscal spending
5 Swap Lines

Now these are the options technically speaking we filled gap around 1.09 this morning, I expected 1.06 on table during open we hit lows of 1.03... Now, if we can hold the levels of these levels and perhaps go above 1.09 then no worries. However, if we carry on with these moves then things will get very interesting and keep an eye on the Gilt & FTSE!

Now it all looks very dismal when it comes towards headlines but actually there are coming amazing investment opportunities the prices we are getting and of course if you're in USA, what a great time for you to visit! For Candle stick traders - dragon fly!

Keep alert of what happens next, this week we have a lot speakers out of CB's and most importantly trade your plan!

Best,

TJ

Note

Bank of England says it "will not hesitate" to raise rates.

No action from the BoE as for today - Leading GBP to have a little pull back.

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Technically: Currently at this moment of time the range of Lows: 1.06350 - Highs:1.09250 areas.

A break to either direction for shorter term idea.

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UK 10 government bond yield jumped from 3.25% to 4.51% in less than a week.

Bank expected to raise rates significantly from their current 2.25 per cent, with markets predicting they could hit six per cent.

Mortgages edges higher... Virgin Money temporarily withdraws all mortgage products in the UK. Credit is in trouble!! Just a few month ago I was mentioning this on the various social platforms I am part of.

UK's Fiscal Blunder is still yet to continue... and dollar - cash is king. Don't fight the trend. Remember: The trend is your friend until it's broken.

Technically, a pattern is forming within 4 hr triangle - range. A break to either direction...

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IMF urges Truss to reverse top rate tax cut in rare intervention.

BOE to temporary buy of long-dated UK bonds. That should elevate GBP higher.

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Reaching key resistance areas of 1.09 handle a break above could take GBP towards 1.10-1.11 areas. However, if we break below 1.06 bears are back in control for now we consolidate.

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Partials taken, letting rest run towards 1.11 areas.

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*UK GOVT EXPECTED TO REVERSE SCRAPPING OF 45% TAX RATE - U turn was made this morning, lets see if this still goes ahead I expect higher GBP above re-testing 1.12 areas. 1.13-1.14 can easily be achieved if they were to extend this further to other factors they had put in this ' mini-budget'...

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THE BANK OF ENGLAND CONFIRMS THAT IT WILL CONTINUE TO BUY LONG-TERM UK GOVERNMENT BONDS UNTIL OCTOBER 14TH

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Liz to hold a press conference later on today.

Headline: Liz Truss to announce corporation tax rise in major mini-Budget U-turn

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2pm press conference due.

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Rumour has it: Kwasi Kwarteng is being sacked as Chancellor as Liz Truss prepares to reverse the mini-Budget.

1.14 1/2 to 1.15 key resistance areas
1.11 to 1.09 3/4 key support areas

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*UK NAMES JEREMY HUNT AS CHANCELLOR

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What he said back in summer... "Right now, the most important thing to tackle in the British economy is inflation."

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Basically we going to do Rishis plan:

UK to reverse almost all tax changes announced September 23rd

Energy intervention being shortened

Next rate expectation is in Nov - BOE.

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Technical view:

Resistance: 1.13700 areas break above takes us to 1.14/1.15 handle and above 1.15, 1.17 can easily be achieved.

Support: 1.11330 areas, if that was to break down, that takes us down to 1.10170 and perhaps high ends of 1.09.

Have a great week ahead.

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Lettuce resigned yesterday: New PM to be announced in week time... For now technically 1.09/1.08 we could head towards if we break below 1.11 handle.

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Rishi seems way ahead, this afternoon it will be confirmed who will be the next PM. Boris is no longer participating.

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Technically: Break above 1.14 then 1.16 will be easily achieved!

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1.24 - 1.26 next area of interest, first a pull back.

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1.30 next area of interest. Any pull back is appreciated.

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Break above and close 1.24660 areas expect 1.26 then perhaps 1.29/1.30 easily Most of the movement for GBP has been due to expect a cut by this yr but overall technically it has been bullish.

As a great trader once stated "what they don't get: they love the fundamental talk and they think price is the discounting mechanism. but you cant know the future of fundamentals and you can't know what price is right even if you could. you can know sentiment and positioning so you can get good risk/reward".

And I agree...

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1.25 KEY RESISTANCE!

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1.25 hit! 1.25 half areas key resistance zone - Weekly & Monthly close is very important.

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1.26 - as long as we stay above 1.23/1.24 bulls are in control and I expect 1.27-1.30-1.35 longer term targets.

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As expected 1.23/1.24 well supported!

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1.24 areas well supported as we go ahead and re-test 1.26 areas! We could even break above and get 1.30 target areas as written for months!!!

Fed meeting this week as well as CPI for US, For GBP - GDP m/m!

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Well...I expect 1.27-1.30-1.35 longer term targets are coming into play!

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1.29! Watch out key resistance zones...

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As we had important data for GBP this morning : Average weekly earnings hit an annual 7.3% growth rate

Could be a for 7% peak rates in 2024! Don't forget about mortgage expiries as well.

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1.30 HIT! next area 1.35 areas if bulls continue!

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CPI came out lower perhaps a lower 25 basis point hike next...leading a pull back for GBP...EURGBP booming!!

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Lower CPI print, less chances of rate hikes going forward. Expect housing to stabilise, GBP & FTSE to increase as time go by.

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One word, get yourself into G I L T S. (Not Financial Advice, your investment is at your own risk).

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Onwards and upwards.

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GILTS rise, as yields fall....Get on board near year! Amazing opportunities, with inflation lowering at a fast rate, expect cuts next year.

Have a prosperous & healthy year ahead

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UK falls into recession, well you know what that means lower equity prices will drop and government bonds will rally.

This was all counted in.

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Next stop 1.30 could be on the table!

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BOE - H A W K I S H. . .

GBP Upwards & Onwards...GBPG, GBP, FTSE Rallying!

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UK General Election 4th July - BOE with the economy striving and GDP growing, will there be need for 'cuts' anytime soon? Time will tell.

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1.28 high areas US CPI today we could reach 1.29 areas! Woohooo! Onwards and Upwards.

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1.29 hit, possible 1.30 could be next area! Lets seeeee

Trade closed: target reached

1.30 hit on futures! Could extend little higher.

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BOE CUTS - GILTS HEAD HIGHER has been our play for over 6 months...Embrace yourself in this environment.

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1.35 COULD BE THE NEXT STOP!

The difference between FED & BOE is the pace of the cuts. BOE are to cut in November go ahead get your real-estate whilst you can and oh go ahead have a cheap trip to USA. ***On minds** on trading view section I've stated we could reached 1.35 (£ Futures)

tradingview.com/u/Trade_Journal/

Trade what you see, not what you think.

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- An ETF you can take advantage of as £ Rises higher, BOE to cut - take opportunity of the UK economy today.

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Lets talk about the budget - Higher taxes, Higher spending and borrowing = LOW GROWTH. Its why we had decline. Cuts are expected in NOV by BOE. We shall see... I Don't see much prospects in UK Economy overall under this government. Unfortunately!

Trade_Journal

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