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06.12.202309:15 Forex Analysis & Reviews: Hot forecast for GBP/USD on December 6, 2023

The dollar continued to rise even if the latest eurozone producer price data suggests that there's a lower chance of a European Central Bank rate cut this month. The greenback likely increased due to the current momentum. Or maybe because the producer price index, although it affects inflation in general, does not directly do so, but only indirectly, furthermore, the impact is also not immediate but is actually felt over time. Therefore, it was better not to draw far-reaching conclusions based on this report. Alas, investors continued to buy the dollar. Of course, one could also refer to the report on job vacancies, which decreased from 9.4 million to 8.7 million. However, the main market movement occurred before this U.S. report was published. Moreover, the decline in the number of job vacancies can indicate both an increase in employment and a reduction by employers themselves. Therefore, it would be difficult to make any conclusions based on this data.

Today, investors await the Eurozone Retail Sales data. The pace of decline of which may slow from -2.9% to -0.8%. Such a substantial increase in consumer activity may be a reason to start a local correction. The U.S. employment data, which is expected to increase by only 125,000, could also exert pressure on the dollar, as the forecasted increase is quite small. Given the population size, its growth rate, and the level of economic activity in the country, to maintain labor market stability, employment should grow at an average of about 250,000 per month. And over the past three months, it has increased by a total of 382,000. Therefore, based on the forecasts, it would be logical for the dollar to show some weakness on Wednesday.

Exchange Rates 06.12.2023 analysis

GBP/USD has extended the current corrective movement. As a result, the quote temporarily fell below the 1.2600 level, indicating an increase in the volume of short positions.

On the four-hour chart, the RSI indicator is moving in the lower area of 30/50, which confirms the increase in selling volumes.

Moving Averages of the Alligator Indicator on the same chart shows that the MA's have completed the intersection phase within the downtrend.

Outlook

Keeping the price below 1.2600 suggests that the pound may fall towards the 1.2500 level. Otherwise, the pair could trade sideways in the range of 1.2600/1.2700.

Comprehensive indicator analysis suggests an upward move in the short-term period since the price returned above the 1.2600 level. Meanwhile, indicators are providing a downward signal in the intraday period due to the ongoing corrective cycle.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

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