Bearish bias keeps rising on the price action of the GBPUSD pair, which alludes to the likely emergence of a new major downtrend. The underlying fundamentals seem to be corroborating this assertion as well.
The August Consumer Price Index (CPI) numbers in the UK exceeded the preliminary forecasts whereas the recorded inflation over the same period in the U.S. fell short of the initial expectations. This divergence prompted the emergence of adverse fluctuations in the price over the short term, but no major breakouts were made. The failure of the price action to break higher implies a likely upcoming reversal.
Global consumption took a sharp dive in August, which is considered to be generally good news for the greenback. That is so because its appeal among investors as a safe currency would likely be bolstered as a consequence.
All of these factors confirm the expectations for the likely development of a new downtrend, and bears should start considering joining the market before the next big price swing takes place.
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