The GBP/USD exchange rate showed high volatility on Friday. It began the day with minor appreciation prior to falling 0.56% after a US data release mid-session. This three-hour decline was stopped by the 200-hour SMA near the 1.39 mark. The Pound’s subsequent movement was stranded between this moving average and the 55– and 100-hour SMAs.
The rate might still edge lower down to the bottom boundary of a three-week channel. A subsequent fall is expected to be limited by the 200-hour SMA at 1.39. Technical indicators are generally bullish for the following trading session, thus favouring a price increase towards the 1.3960 area where the senior channel and the 38.20 Fibonacci retracement are located.
Meanwhile, G20 meetings are to dominate the political and economic environment during the following two days.
The rate might still edge lower down to the bottom boundary of a three-week channel. A subsequent fall is expected to be limited by the 200-hour SMA at 1.39. Technical indicators are generally bullish for the following trading session, thus favouring a price increase towards the 1.3960 area where the senior channel and the 38.20 Fibonacci retracement are located.
Meanwhile, G20 meetings are to dominate the political and economic environment during the following two days.
Comment:
The Sterling was generally steady against the US Dollar on Tuesday, as traders were awaiting patiently for the Fed monetary policy statement at 1800GMT. The only volatility during the day was introduced by the British CPI which showed sluggish performance during the previous month.
Bears pressured the Pound lower for a few hours until the 55-hour SMA near 1.40 was reached. The pair has been subsequently guided by this line, suggesting that the same situation might continue during the first part of the day when the rate might push for the weekly R2 at 1.4080.
By and large, the Fed is very likely to end this still movement and elicit notable reaction. The 1.3930 mark should restrict bearish momentum due to strong support levels. Conversely, upside potential is up to 1.4120.
The Sterling was generally steady against the US Dollar on Tuesday, as traders were awaiting patiently for the Fed monetary policy statement at 1800GMT. The only volatility during the day was introduced by the British CPI which showed sluggish performance during the previous month.
Bears pressured the Pound lower for a few hours until the 55-hour SMA near 1.40 was reached. The pair has been subsequently guided by this line, suggesting that the same situation might continue during the first part of the day when the rate might push for the weekly R2 at 1.4080.
By and large, the Fed is very likely to end this still movement and elicit notable reaction. The 1.3930 mark should restrict bearish momentum due to strong support levels. Conversely, upside potential is up to 1.4120.
Comment:
GBP/USD was guided primarily by the 55-hour SMA during the first part of Wednesday which allowed to reach a three-week resistance of 1.4080.
Bullish strength was added late in the evening when the Fed increased its benchmark rate to 1.75%, but did lower the number of projected hikes to three this year. This caused a significant weakening of the US Dollar across all major currencies and thus paved the way for the Sterling to test the weekly R3 at 1.4170.
Technical indicators are starting to retrace from their high positions. This points to possible depreciation during the following hours, at least.
Volatility is likely to increase mid-session when the BOE is to release its Monetary Policy Summary at 1200GMT. Downside potential today is the 1.40 area, while strong resistance is set at 1.4220.
GBP/USD was guided primarily by the 55-hour SMA during the first part of Wednesday which allowed to reach a three-week resistance of 1.4080.
Bullish strength was added late in the evening when the Fed increased its benchmark rate to 1.75%, but did lower the number of projected hikes to three this year. This caused a significant weakening of the US Dollar across all major currencies and thus paved the way for the Sterling to test the weekly R3 at 1.4170.
Technical indicators are starting to retrace from their high positions. This points to possible depreciation during the following hours, at least.
Volatility is likely to increase mid-session when the BOE is to release its Monetary Policy Summary at 1200GMT. Downside potential today is the 1.40 area, while strong resistance is set at 1.4220.
Comment:
The Sterling was trading at its seven-week high of 1.4170 on Thursday morning, as the strong resistance of the weekly R3 did not allow it to push above this mark for several hours.
High volatility was introduced at 1200GMT when the BOE published its Monetary Policy Summary. Even though its benchmark rate was kept steady in line with expectations, the surprise element was introduced by MPC Official Bank Rate votes. The impact was the rate’s fluctuation in a 92-pip range after the release.
The subsequent price decline was stopped by the 55-hour SMA which has guided the pair ever since.
The pair consolidating slightly above this line suggests that some downward momentum until 1.4050 could occur. Technical indicators, on the other hand, are bullish and favour a climb towards the 1.4170 area.
The Sterling was trading at its seven-week high of 1.4170 on Thursday morning, as the strong resistance of the weekly R3 did not allow it to push above this mark for several hours.
High volatility was introduced at 1200GMT when the BOE published its Monetary Policy Summary. Even though its benchmark rate was kept steady in line with expectations, the surprise element was introduced by MPC Official Bank Rate votes. The impact was the rate’s fluctuation in a 92-pip range after the release.
The subsequent price decline was stopped by the 55-hour SMA which has guided the pair ever since.
The pair consolidating slightly above this line suggests that some downward momentum until 1.4050 could occur. Technical indicators, on the other hand, are bullish and favour a climb towards the 1.4170 area.
The British Sterling was bounded by moving averages during the first part of Monday, thus trading in line with a short-term channel down.
This lack of momentum changed significantly mid-session when a successful Brexit deal between the EU ad the UK shot up the rate by 1.03% within a couple of hours. As a result, the pair breached the prevailing senior channel and pushed as high as the weekly R2 at 1.4080.
Technical indicators still flash strongly bullish signals; however, their direction does show a tendency southwards. Thus, traders should see a bearish correction to the 1.40 area where the 55– and 100-hour SMAs are located.
In case no fundamentals shake the market today, it is unlikely that the 1.4080 is breached, thus paving the way for a slide south.