GBP/USD Forecast: Dovish BOE hits Pound

GBP/USD Current Price: 1.2823
- The Bank of England left rates unchanged, although two members voted for a cut.
- Governor Carney concerned about employment, the risks of a global economic downturn.
- GBP/USD battling to retain the 1.2800 threshold, bearish in the short-term.
The GBP/USD pair fell this Thursday to 1.2793, its lowest since September 24, as the Bank of England surprised with a dovish decision. MPC decided to leave it’s monetary policy unchanged, although two members voted for a rate cut. Governor Carney, in his later speech, flagged the risks of a global economic downturn and warned that a no-deal Brexit would likely result in job losses and business closures. The central bank has kick-started the year with a hawkish view of the economy, with policymakers inclined for a rate hike. This time, it seems they are closer to easing the monetary policy. The never-ending Brexit drama, for sure adds to policymakers’ concerns. The UK won’t release relevant macroeconomic data this Friday.
GBP/USD short-term technical outlook
The GBP/USD pair has recovered from the mentioned low, trading around the 23.6% retracement of its October rally at 1.2820, with a neutral-to-bearish short-term stance. The 4 hours chart shows that the upside has been capped by a bearish 20 SMA crossing below the 100 SMA, while technical indicators stabilised in negative territory. Further declines should be expected on a break below 1.2785, the immediate support.
Support levels: 1.2785 1.2750 1.2720
Resistance levels: 1.2870 1.2910 1.2950
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.


















