October 30, 2024 at 03:01PM
The GBPUSD early in the US session retested the low price from Monday’s trade at 1.2938. That level was also a swing level going back in time to July and August. Support held and the price was able to rebound back above its 100 day moving average of 1.29742.
Sellers turn to buyers and the price shot higher and the price move back above the 1.3000 level, and then the 100 bar moving average on a 4-hour chart above 1.30172. The high price stalled at 1.30424, and has rotated back below the aforementioned moving average level.
Although the price moved above the previous high for the day and back above the 100 bar moving average on the 4-hour chart at 1.30172, momentum seems to be fading once again. Of note is the 50% midpoint of the move up from the August low at 1.30488 remains a upside target to get above to increase the bullish bias
What we also know is that the 1.2938 level solidified itself as a key support. That level would need to be broken to increase the bearish bias.
Price action is volatile as UK Chancellor Reeves presents the first budget for the new administration. THe budget
Raised taxes by 40 billion pounds
Projected public-sector borrowing of $105.6 billion in 2025/2026
Caps corporate tax rate of 25% for the duration of Parliament
will increase the lower rate of capital gains to 18% from 10% and the higher rebel rise to 24%.
Meanwhile, the OBR forecasts showed:
2024 GDP Growth: 1.1% (prev. forecast 0.8%). HIGHER
2025 GDP Growth: 2.0% (prev. 1.9%). HIGHER
2026 GDP Growth: 1.8% (prev. 2.0%). LOWER
2027 GDP Growth: 1.5% (prev. 1.8%). HIGHER
2024 CPI Inflation: 2.5% (prev. 2.2%). HIGHER
2025 CPI Inflation: 2.6% (prev. 1.5%): HIGHER
2026 CPI Inflation: 2.3% (prev. 1.6%). HIGHER
2027 CPI Inflation: 2.1% (prev. 1.9%). HIGHER
2025/26 Current Budget Deficit: GBP 26.2 billion (prev. forecast GBP 16.5 billion)
OBR says budget will boost long-term growth
OBR says borrowing in this financial year is GBP 127 billion
The 10 year yields are higher by 6.2 basis points and at highs for the day at 4.378%. That takes the yield to the highest level since May 31. The high yield the year comes in a 4.418%. The chatter is at the Bank of England may have less room to
This article was written by Greg Michalowski at www.forexlive.com.
