GBP/USD has been quite corrective and volatile recently residing inside the price range from 1.3130 to 1.3270. GBP has been quite mixed with the economic reports whereas the market sentiment has been USD biased recently. Market participants anticipate that the BOE will increase the interest rates from 0.25% to 0.50%, which is expected to lead to further gains on the GBP side. Recently, the Net Lending to Individuals report was published in the UK with a decreased figure of 5.5B from the previous 5.7B. The M4 Money Supply data was published with a negative value of -0.2% from the previous positive value of 1.1% which was expected to be at 0.7%. The Mortgage Approvals was also published as expected at 66k which previously was at 67. Furthermore, the GfK Consumer Confidence report was published with greater deficit as expected at -10 from the previous figure of -9. The latest UK economic reports came in line with forecasts which helped the currency to gain strength ahead of the interest rate decision that is due to be published on Thursday. On the USD side, the United States presented quite positive economic reports and ahead of the rate decision on Wednesday certain volatility is expected in this pair. Today the US Employment Cost Index report is going to be published which is expected to show an increase to 0.7% from the previous value of 0.5%, the S&P/CS Composite-20 HPI report is expected to be unchanged at 5.8%, while the Chicago PMI report is expected to decrease to 60.2 from the previous figure of 65.2. Besides, the CB Consumer Confidence report is expected to show an increase to 121.1 from the previous figure of 119.8. To sum up, this week is going to be a very volatile and liquid for the pair as there will be only 18 hours of time difference from the US Interest Rate decision and the BOE Interest Rate which is expected to make the market spike a lot. Currently the price is in range but after the rate decisions are done we will be getting the indication for the further moves. GBP is expected to have an upper hand over USD as this month the United Kingdom is likely to increase the interest rate whereas the Fed rate hike is expected to happen in December.
Now let us look at the technical view. The price is currently residing inside a corrective range between 1.3130 and 1.3270. The pair is currently being held by dynamic level of 20 EMA as resistance but due to recent false break and impulsive bullish pressure it is expected that the price will break above the range and create new highs with target towards 1.3650 resistance area. As the price remains above 1.3100-30 support area, the bullish bias is expected to continue further.