GBP/USD continues to trade within a well-defined range after a multi-week advance, with price now testing a major resistance zone on the back of the Fed and Bank of England rate decisions. The sustained rally reflects improving near-term momentum, but the lack of a breakout keeps the focus on this key barrier.
GBP/USD surges amid lower-than-expected US GDP growth, BoE hold
EUR/USD, GBP/USD update after the Bank of England and ECB: The US Dollar tumbles as FX markets digest a slew of central bank decisions. While policymakers remain cautious over surging energy prices, a decoupling from crude oil has brought momentum into European currencies.
GBPUSD managed to pass above the resistance of 1.3485 to meet the first target at 1.3580. As we see over the chart, the market is facing the first support zone at 1.3485, where if prices remain above it, more advance will be expected with resistances at 1.3580 and 1.3710-35.
The 10-year yield drops on Thursday, perhaps offering a bit of relief for many assets around the world.
GBP/USD is rising towards 1.35, its highest level since April 9, following a hawkish hold from the Federal Reserve and ahead of the Bank of England interest rate decision today.
GBP/USD Price Forecast: Remains sticky around 20-day EMA in countdown to BoE's policy
Pound Sterling Price News and Forecast: GBP/USD bulls seem hesitant amid the Fed's hawkish tilt
Looking at the 4-hour chart, the pair declined toward the 38.2% Fib retracement level of the upward move from the 1.3177 swing low to the 1.3599 high. However, it is still stable above the 100 simple moving average (red, 4-hour) and the 200 simple moving average (green, 4-hour).
The impact from the ECB and BoE monetary policy decisions later today may prove fleeting if it runs counter to what's happening in energy markets, with both EUR/USD and GBP/USD effectively trading as proxies for crude right now rather than rate differentials.
GBP/USD treading water as BoE and US PCE collide in 90-minute window: who wins?
The Pound to Australian Dollar (GBP/AUD) exchange rate edged higher on Wednesday as softer-than-expected Australian inflation prompted some profit-taking in the ‘Aussie'. At the time of writing, GBP/AUD was trading around AU$1.8854, up roughly 0.2% on the day.