🔍 Fundamental Overview
The British pound enters the third week of September with bullish momentum, supported by a weakening U.S. dollar and cautious optimism around the Bank of England’s policy stance.
🇺🇸 United States:
• Fed Rate Outlook: Markets expect a 25bps rate cut at the 17 September FOMC meeting, driven by soft inflation and labor data.
• Labor Market: Jobless claims surged to 263K; manufacturing data (Empire State Index) dropped to -8.7, signaling contraction.
• Dollar Sentiment: The greenback remains under pressure as traders price in dovish Fed action.
🇬🇧 United Kingdom:
• BoE Policy Outlook: The Bank of England is expected to hold rates at 4.0% this week, balancing high inflation with stagnant labor market conditions.
• Domestic Challenges: Economic growth remains sluggish, but the pound is benefiting from narrowing rate differentials with the U.S.
• Market Focus: Traders await key UK data releases, including retail sales and CPI.

📊 Technical Analysis
Support Levels:
• 1.3472 – 50-day EMA
• 1.3400 – medium-term support
• 1.3340 – extended bearish target
Resistance Levels:
• 1.3600 – psychological barrier
• 1.3658 – upper fractal (July 2025 candle)
• 1.3787 – weekly breakout target
Indicators:
• MACD: Bullish crossover
• Stochastic: Near overbought
• RSI: 62 – bullish momentum
• Bollinger Bands: Expanding – volatility rising

📈 Trading Scenarios
✅ Bullish Setup:
• Entry: Above 1.3600 with confirmation
• Targets: 1.3658 ➡️ 1.3787
• Stop-Loss: Below 1.3470
• Catalysts: Weak USD, BoE rate hold, technical breakout
❌ Bearish Setup:
• Entry: Below 1.3470
• Targets: 1.3400 ➡️ 1.3340
• Stop-Loss: Above 1.3550
• Catalysts: Hawkish Fed surprise, weak UK data, risk-off sentiment