GBP/USD Forex Signal 16/09: Extremely Bullish (Chart)

(MENAFN- Daily Forex) Bullish view

• Buy the GBP/USD pair and set a take-profit at 1.3700.
• Add a stop-loss at 1.3500.
• Timeline: 1-2 days.

Bearish view

• Sell the GBP/USD pair and set a take-profit at 1.3500.
• Add a stop-loss at 1.3700.

The GBP/USD exchange rate continued rising, reaching its highest level since July 10. It has jumped by over 3.5% from its lowest level this month, ahead of major events this week and Federal Reserve Decisions

The GBP/USD pair continued its uptrend ahead of key economic data from the United States and the UK. The first report will come on Tuesday morning when the Office of National Statistics (ONS) releases the July jobs report.

Economists expect the data to show that the economy created 220k jobs in the three months to July. Its unemployment rate is expected to be 4.7%.

The next important catalyst for the GBP/USD pair will be the upcoming US retail sales and industrial and manufacturing production data. These numbers will provide more information about the health of the American economy.

Economists expect the data to show that the retail sales slowed from 0.5% in July to 0.3% on a month-on-month basis. They also expect the report to move from 3.9% in July to 3.2% in August.

These numbers comes ahead of the upcoming Federal Reserve and Bank of England interest rate decisions. Economists expect the two banks to diverge in these meetings, with the Federal Reserve expected to cut interest rates and the Bank of England expected to maintain them unchanged.

The Fed will cut rates because of the ongoing fear that the labor market is worsening. A report released earlier this month showed that the unemployment rate rose to 4.3% in August as the economy created just 22,000 jobs.

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The BoE, on the other hand, is concerned about the country's inflation, which has remained stubbornly high this year. A recent report showed that the headline Consumer Price Index jumped to 3.6%. A report coming out on Wednesday is expected to show that the CPI rose to 3.8% in August.

EURUSD Chart by TradingViewGBP/USD Technical Analysis

The daily timeframe chart shows that the GBP/USD exchange rate has been in a strong uptrend in the past few days. It has moved from a low of 1.3140 in August to a high of 1.3605 today.

The pair has moved above the Ichimoku cloud indicator and the 50-day Exponential Moving Average (EMA). The Relative Strength Index has moved above the neutral point at 50 and is hovering at the highest level in over a month.

Therefore, the pair will likely continue rising as bulls target the next important resistance level at 1.3700. A move above that level will point to more gains to the year-to-date high 1.3787.

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