- The US economy grew by 2.8%, below estimates of 3.0%.
- The US reported dismal job growth in October.
- Market participants will focus on the Bank of England’s policy meeting.
The GBP/USD weekly forecast supports further downside with the upcoming BoE rate cut and the US presidential election.
GBP/USD Ups and Downs
The pound had a marginally lower week as the dollar fluctuated amid mixed economic reports. The US economy grew by 2.8%, below estimates of 3.0%. A weaker-than-expected economic performance temporarily weighed on the dollar.
–Are you interested in learning more about forex options trading? Check out our detailed guide-
Another report on Thursday found that inflation accelerated by 0.3%, which met forecasts. Meanwhile, the US reported dismal job growth on Friday. The economy added just 12,000 jobs compared to estimates of 106,000. Meanwhile, the unemployment rate is stable at 4.1%. The dollar initially sank but recovered before the day ended as focus shifted to the upcoming presidential election.
Next week’s key events for GBP/USD
Next week, market participants will focus on the Bank of England’s policy meeting on Thursday. The central bank is likely to cut borrowing costs by 25 basis points, according to a Reuters poll. Notably, UK inflation has fallen below the 2 percent target, putting more pressure on policymakers to cut rates. However, economists believe this could be the last rate cut this year.
Similarly, the Federal Reserve could cut rates by 25 bps on the same day. Recent data from the US has shifted the outlook for Fed rate cuts to a more gradual pace. However, market participants will pay attention to the messages for future policy moves. Furthermore, the US will release data on initial jobless claims and non-farm productivity.
GBP/USD weekly technical forecast: Lower low strengthens bearish bias
From the technical side, GBP/USD the price broke below and retested the key level of 1.3002. With this move, the bears confirmed a new downtrend by breaking below the previous low to make a lower low. The reversal started at the resistance level of 1.3400. Here, the price started making strong bearish candles, which later broke the 22-SMA support and the bullish trend line.
–Are you interested in learning more about Forex robots? Check out our detailed guide-
Currently, GBP/USD is jumping lower after retesting the 1.3002 level. The price has pushed below the SMA and the RSI is in bearish territory. In the coming week, the bears will target the support level of 1.2701. Furthermore, the bearish bias will remain if the price remains below the SMA and RSI below 50.
Do you want to trade Forex now? Invest in eToro!
67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing money.
