🔍 Fundamental Overview
GBP/USD traded with mixed momentum last week, oscillating between corrective gains and renewed selling pressure. Sterling briefly tested higher levels but remains vulnerable amid weak UK fundamentals and cautious global sentiment.
🇬🇧 United Kingdom:
• Economic Data: UK GDP growth slowed to 0.1% QoQ in Q3, signaling stagnation. Industrial output contracted, and productivity fell by 0.6% in Q2.
• Inflation: CPI eased to 3.6% in October from 3.8%, reinforcing expectations of policy easing. Core CPI slipped to 3.4%.
• Labor Market: Unemployment rose to 4.8%, the highest since 2021, with payrolled employees declining.
• BoE Outlook: Markets price in a rate cut in December, as growth falters and inflation moderates.
• Political Climate: Fiscal uncertainty persists ahead of the late-November budget, with speculation about tax policy shifts adding volatility.
🇺🇸 United States:
• Fed Policy: The Fed cut rates by 25 bps to 3.75%-4.00% on Oct 29 but signaled caution on further easing. December cut odds have fallen to ~50%.
• Macro Signals: Consumer spending resilient, but labor market soft; ADP data showed weak job growth. Inflation remains sticky near 3%, complicating policy.
• Risk Sentiment: Dollar demand supported by global uncertainty and relatively high U.S. yields despite easing bias.

📊 Technical Analysis
Support Levels:
• 1.3265/80 – Key structural support zone
• 1.3220 – 200-DMA and short-term floor
• 1.3125 – Extended downside target
Resistance Levels:
• 1.3445 – Initial breakout trigger
• 1.3545 – Weekly pivot and corrective cap
• 1.3590 – Bullish extension target
Indicators:
• MACD: Bearish momentum moderating; potential for corrective uptick
• RSI: ~48 – Neutral, leaning bearish
• Stochastic: Recovering from oversold territory
• 50-day MA: Price below 1.3400; sustained close above 1.3445 needed for bullish reversal

📈 Trading Scenarios
✅ Bullish Setup:
• Entry: Above 1.3445 with confirmation
• Targets: 1.3545 ➡️ 1.3590
• Stop-Loss: Below 1.3265
• Catalysts: Fed dovish tone, risk-on flows, UK fiscal clarity
❌ Bearish Setup:
• Entry: Below 1.3265
• Targets: 1.3220 ➡️ 1.3125
• Stop-Loss: Above 1.3445
• Catalysts: Strong U.S. data, hawkish Fed signals, UK economic weakness