Before we proceed, let me draw your attention towards a small bearish channel setup on the hourly timeframe. The Cable is trading right below the upper trendline resistance level of $1.3100. This pattern is also called a bullish flag, and typically drives buying trend in the market. You can see a candlestick pattern ‘bearish marubozu’ which is the bearish pattern in nature.
Alongside, the RSI and Stochastics are coming out of an oversold area, implying the market is already at low and bullish may dominate the market for correction.
At 9:30 (GMT), the focus will remain on the UK construction PMI data. As per forecast, the construction PMI seems to show a slight drop from 52.8 to 52.6. Weaker data will add more selling pressure on the GBP/USD today.
Key Trading Level: 1.3079
GBP/USD – Trading Plan
Investors are advised to keep a closer eye on a thin trading range of $1.3090. The idea is to stay bullish above $1.3090 and bearish below $1.3085 to target 50 pips on both sides.
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