Key events today:

18:00 UTC: USD – Release of the FOMC meeting minutes.

The GBP/USD pair broke a five-day losing streak, closing on Tuesday in the green by one-sixth of a percent. Although traders in the cable market managed to halt the short-term losing streak, the pair remains on the downside of the 50-day Exponential Moving Average (EMA).

In the first half of the trading week, data from the UK remains scarce, so pound traders are waiting for the Bank of England (BoE) monetary policy report hearings scheduled for Thursday. This will be followed by the release of the UK Gross Domestic Product (GDP) data on Friday.

On Wednesday, the latest minutes of the Federal Reserve’s meeting, which saw a rate cut in September, will be released, providing dollar traders with much to digest. Markets had widely hoped for a follow-up double rate cut in November after the Fed opened the door by sharply cutting the rate by 50 basis points in September. However, core inflation remains above the Fed’s target level, and U.S. labor market data, which far exceeded expectations last week, have significantly dampened hopes for a rate cut.

According to the CME’s FedWatch tool, the likelihood that the Fed will follow up September’s sharp 50 basis point cut with a more modest 25 basis point cut on November 7 is nearly 90%. Fed officials have widely signaled that a weakening of the U.S. labor market would be required to prompt the Federal Reserve towards further sharp rate cuts.

Recommendations: Trading primarily with Buy orders from the current price levels.