GBP/USD analysis: neutral ahead of BOE

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3125

Investors remain away from the Pound on uncertainty over BOE's next move.
UK data disappointed again, with the UK Markit Manufacturing PMI down to 54.0 in July.

The GBP/USD pair traded uneventfully around 1.3120 for most of the day, peaking at 1.3143 but retreating afterward, as the UK Markit Manufacturing PMI disappointed. The index fell to 54.0 in July the lowest in three months, while June reading was downwardly revised to 54.3. The slowdown in business activities was attributed to mounting Brexit risks. The on-hold stance is correlated to the upcoming BOE's monetary policy meeting this Thursday, as the central bank is expected to hike rates by 25bp, despite recent data and the lack of progress in Brexit negotiations suggest that policymakers may decide to stay pat. Even in the case of a hike, Pound gains could be short-lived, ahead of a clearer picture on Brexit. From a technical point of view, the pair retains its neutral stance in the short term, as in the 4 hours chart, it remains stuck to a directionless 20 SMA, while technical indicators continue pivoting directionless around their midlines.

Support levels: 1.3090 1.3045 1.3010

Resistance levels: 1.3150 1.3190 1.3230

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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