GBP/USD Price Analysis: The pound stutters ahead of 1.32 despite a less dovish BoE
|- GBP/USD trades 0.25% higher and is only outdone by the antipodeans on Thursday.
- The trend on the daily chart is still very strong and today's close could be significant.
GBP/USD daily chart
Cable has had an interesting session. There was some early GBP strength after the Bank of England was less dovish than some analysts might have expected. There was no move on rates and QE but the MPC members backtracked on their stance on negative rates saying "negative rates are in the BoE toolbox, but no plans to use them".
Looking at the chart, there was a spike higher but the price has pulled back somewhat. The daily candle might be a shooting start or inverted hammer which is bearish but we would need to wait for the close for confirmation. There is also a resistance one at 1.32 and there could be a sticky point there but for now, the trend is still up.
On the downside. 1.30 has proved itself to be a great support area. On the lower timeframes, it is slightly clearer but the rejection at the psychological level was solid. If we are looking for the next support It would still be at the 1.30 zone but beyond that, there is another level at the purple line near 1.28 and the price is quite some way away from there.
The indicators are still looking very bullish. The Relative Strength Index is in the overbought zone but that does not always mean a reversal is coming. The MACD histogram bars are still green and the signal lines are also still above the mid-point.
Overall, this is still a firm uptrend. On the 4-hour timeframe, there is a Relative Strength Index divergence but only a break of 1.30 would confirm the bearishness. Tomorrow could be a volatile session (NFP) and much of the price action will depend on the dollar.
-637323370153478151.png){kind=link}
Additional levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.