Fundamental analysis cannot be underrated in fx trading, they are equally important as technical analysis.GBP has been on a steady upward trajectory over the last two weeks, but the economic news has initiated a trend change pushing it below the 1.29300 mark.
The recently divulged inflation data has recorded a significant drop in inflation in the united kingdom which is a plus for BOE, as they have been raising the interest rates to curb to mushrooming inflation.
The inflation rate for June -Actual 0.1%, previous 0.7%
The inflation rate of the year -Actual 6.9%, previous 7.1%
In FX trading, the lower the inflation the weaker the currency, the reason being higher inflation attracts higher interest rates and vice verser. Single economic news is not enough to determine the new direction the affected currency will take, so it takes the diligence of the traders as they execute their trades.
IN MY OPINION: The GBPUSD chart pattern shows the start of a strong bearish trend
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