It seems like the end of this week is going to be hot for the USD. The main question is: can the USD hold the GBP as it has been doing for the last 2 months? The GB Pound may lose a lot due to the rising pressure from the US FRS. Mainly it may happen in the background of the increasing natural gas prices and the approaching winter.

Fundamental arguments:

The main point is that the time frame when the US can move from words to actions is shrinking. The gas price plays a vital role for the GBP as the rising price acts as a powerful brake on the economy in the post-covid times.

Technical arguments:

The current situation looks like a slight side movement, waiting for the downward trend to continue. From the fundamental point of view, this is already confirmed, and the support line will be breached. However, as we can see in picture 1, now we can expect a short-term correction, which is indicated by the Stochastic indicator and the downward triangle. You can enable Stochastic while trading on IronTrade. As you can see it helps a lot in identifying trends.

Picture 1. A price chart of the GBPUSD and the chart of the large Stochastic indicator for 13.04.2021 – 24.09.2021.

Forecast

Well, in view of all this, we expect a DOWNWARDS trend so far. It is indicated by increasing expectations from the USD and the significant increase in the natural gas price and the cost of electricity.

We recommend using the Stochastic indicator for better control over your positions. Stochastic is available for free on IronTrade. Stochastic helps to recognize when the market fluctuates in lateral trend and identify the cycle length.

We recommend keeping 4 trades up and 3 trades down at the same time. It is the optimal number of open positions at this moment.

Don’t forget to take advantage of this insightful information on IronTrade!