FxWirePro: GBP/USD falls to six-week ,vulnerable to more downside

• GBP/USD slipped to  hit six-week low on Wednesday as sterling remained under pressure against a firmer dollar.

• UK CPI rose to 3.1% y/y as expected, keeping inflation pressures elevated and reinforcing expectations that the Bank of England will leave interest rates unchanged at Thursday’s meeting.

• Focus now shifts to the Federal Reserve, where markets largely expect a rate hike. However, Chair Kevin Warsh’s guidance on the policy outlook could have a greater impact on sterling than the widely anticipated move itself.

• The Fed is scheduled to announce its rate decision at 1800 GMT, with Warsh’s press briefing beginning at 1830 GMT. Markets will closely assess his comments on inflation, growth and the path for future rates.

•Meanwhile, Bank of England is expected to hold interest rates steady at its Thursday meeting   as markets assess the impact of still-elevated UK inflation.

•   Immediate resistance is located at 1.3507(38.2%fib), any close above will push the pair towards 1.3552(SMA 20)

•  Strong support is seen at 1.3434(Lower BB) and break below could take the pair towards 1.3405(50%fib)

  Recommendation: Good to sell around 1.3450, with stop loss of 1.3560 and target price of 1.3360