1. Technical Overview
Chart Tools
After the FOMC decision, the GBP/USD pair lost little ground, now trading around 1.2625, offering a neutral-to-bearish stance in the short term, given that, in the 4 hours chart, its hovering around a directionless 20 SMA and still well below a bearish 200 EMA, while technical indicators turned lower, now piercing their midlines. The Sterling continues to be dependent on Brexit-related headlines, with speculative interest not interested in the pair unless some news from that front. The risk weekly low has been set at 1.2554, with chances of a downward move increasing on a break below it.
Support levels: 1.2590 1.2555 1.2510
Resistance levels: 1.2660 1.2695 1.2730
2. Fundamental Overview
According to the official release, the UK CPI eased to 2.3% YoY in November as expected, its lowest in almost two years. When compared to the previous month, inflation was up by 0.2%, also meeting the market's forecast. In the Brexit front, PM May has repeated that she is working with the EU to get the reassurances the Parliament wants to pass the deal, something that will probably happen by the ends of June. The Bank of England will reveal the result of its latest monetary policy meeting this Thursday, although no changes are expected to introduce to rates or the APP program. All the 9 voting members are expected to decide to keep rates on hold. The Minutes, which will be released alongside, could gather some attention.
3.Overview
With regard to short-term, I think the price will be increasing a little looking at the candlestick patterns. A reversal signal appears on the 4H chart.