Good morning, traders.

Who’s up for trading the Sterling today?  The fundamental side is fully loaded with high impact economic events from the U.K. in particular and Inflation Report Hearings are on top of the list. Watch out for the top economic events and a trading idea…

Economic Event’s Watchlist

Japanese Yen – JPY

BOJ Core CPI y/y – At 5:00 (GMT) the Bank of Japan is due to release the Japanese inflation data. The CPI figure is forecasted to be 0.6% down from 0.7%. Fellas, the BOE is fighting with deflationary risks and has started improving its inflation since May 2017. But the CPI figures fell from 0.8% to 0.7% in April, weighting BOE to keep the policy dovish.

Today, if the CPI figure comes out less than expected or below 0.7%, this is going to form dovish sentiments for BOE’s upcoming policy meeting. So, you need to monitor the inflation data very closely to capture any divergence in the data.

Great Britain Pound – GBP

Inflation Report Hearings – At 9:00 (GMT), the BOE Governor and several MPC members will testify on inflation and the economic outlook before Parliament’s Treasury Committee.  

As we know, the U.K. inflation fell more than expected to 2.5% in March, lowering expectations for a rate hike. Core CPI is projected to slow from 2.3% to 2.2%. Let’s see what Mark Carney has to say about it. The expectations of another slowdown will put the sterling in trouble.  

Public Sector Net Borrowing – It shows a variation in value between spending and income for public corporations, the central government and local governmental offices during the previous month. A positive number indicates a deficit in the budget, a negative number indicates a surplus. The data will be monitored at 8:30 (GMT).

GBP/USD- Breakout of Sideway Range

On the 4- hour chart, the Cable has come out of the sideways channel which kept the pair consolidating in the trading range of $1.3460 – $1.3600. The breakout came in response to friendly tweets from U.S. President Tump regarding China tariff issues.  

Technically speaking, the GBP/JPY is likely to face resistance up at $1.3460 and the violation of this is likely to lead the pair towards $1.3490 today.  The bearish trendline resistance will be working as a solid hurdle up there. Below $1.3460, the Cable has a potential to go after $1.3375 and $1.3305 today.  

GBP/USD – Key Trading Levels

Support     Resistance

1.3401          1.3465

1.338            1.3486

1.3348         1.3518

Key Trading Level:    1.3433

GBP/USD – Trading Plan

The idea is to stay bearish below $1.3460 with a stop above $1.3510 to target 1.3375 before the news release. Good luck and stay tuned for forex trading signals and live market updates.