The BOE Is Going To Cut Rates, This Is How You Profit

September 27, 2022

Contents ▾

Rate Cuts Are "Plausible"
The GBP/USD
The EUR/GBP

Value Cuts Are "Slick"

The pound weakened versus the mankind's major currencies afterwards other dovish cry from the BOE. Pecuniary Insurance Citizens committee member Michael Saunders says IT is plausible the BOE could lower rates at the next get together. The tidings is not a surprise, many a in the profession have been expecting a cut for any time. The UK economy is along shaky ground and the approaching hard-Brexit is not going to help. There was rattling little UK-specific information this weak other than steel production, which is down, so traders have very minuscule concrete information to work with.

Regarding the Brexit, PM Boris Johnson is steadfast in his position to carry the UK unstylish of the EC on October 31st with out without a deal. It is, as a matter of fact, that very pledge that got him electoral to Prime Minister to begin with. The Europium says they will non renegotiate the deal unless the U.K. can line up with some separate solution to the Irish Gaelic-Backstop. Eventide today, EU President Denim-Claude Juncker said information technology will be the UK's fault if a No-deal Brexit unfolds.

The GBP/USD

The GBP/USD slipped on the Saunders news and set a new two week rock-bottom. The low is infra the short-term 30-day EMA and the 1.2325 support pipeline so foster descending social movement is workable. The indicators are bearish and suggest prices could fall to the snuggle get down support fair game. The next let down support target is 1.2200 and likely reached within the following week operating room so, providing the data next week is quieten solid. In the U.S. I mean. U.S. PCE prices came out today likewise, core PCE prices ticked high to 1.8% and suggest the FOMC's alleviation "cycle" may already be over. A firmer dollar would help accelerate the pounds decline and take IT 1.2000.

The EUR/GBP

The EUR/GBP is moving up off of an extreme low set just a week or so ago. The low was driven by strengthening in the hammer due to Brexit hopes that were compounded by a generally pacifistic expectation for the ECB. At once, the ECB has through both QE and my get along more just there is a twist. The BOE is some to pop cutting rates which could this pair shooting higher. In the near term, I would have a bun in the oven to see the EUR/GBP move improving to examine resistance near 0.8925. If prices break above the short-term EMA that would follow bullish. If electrical resistance is confirmed prices could drop back to 0.8800 very quickly, it just depends on what the BOE does.