Last week rally in the GBP/USD is still corrective in nature and part of a larger symmetrical triangle pattern. Only a break of the 1.3480 would threaten a larger retracement into the Brexit sell off. As the bullish momentum will show an unwillingness to advance there is scope for GBP/USD to continue inside a very wide range. Normally price should stay below 1.3400 the upper limit of the symmetrical triangle pattern, but the downside should also be limited to the 1.3150 - 1.3100 support zone. Fundamentally speaking Cable’s rally was inspired by the spectacular jump in the UK’s manufacturing sector, which posted the largest month-on-month increase in the last 25 years. In the week ahead, we should expect a slow start of the week due to Monday’s US Labor day which means very low trading activity. Notable risk events in the coming week are the UK’s Manufacturing Production scheduled on Wednesday and the market consensus is for a soft reading of -0.5%, down from -0.3%, while the Industrial production is expected to inch lower to -0.2%, down from 0.1%.

GBPUSD Weekly Forex Forecast - 5th Sept to 9th Sept 2016 - BEARISH