BoE Minutes surprised to the upside, as two voting members wanted a rate hike this month, first split in vote in over 3 years: Martin Weale and Ian McCafferty voted to increase the benchmark rate by 25 basis points from a record-low 0.5 percent, according to the minutes of the Monetary Policy Committee’s Aug. 6-7 meeting.
But the statement also showed most MPC members will like to wait for firmer evidence that wage growth will come before moving rates, not hawkish enough according to GBP/USD price action: the 4 hours chart shows price stalled at 1.6678, right below its 20 SMA in the mentioned time frame that maintains a clear bearish slope. Momentum maintains its bearish slope and stands near oversold levels, while RSI barely corrects higher, both well into negative territory. Furthermore, price retraced back to 1.6650 price zone, 200 DMA suggesting data is not enough to revert current bearish trend.
Some consolidation should be expected now, yet as long as the high holds, the upside will remain limited, with a break below 1.6600 putting the pair back in the bearish track towards 1.6540/60 price zone. A steady advance beyond 1.6680 on the other hand, may see price attempting a recovery towards 1.6730, where a daily descendant trend line coming from this year high should halt further advances.
View Live Chart for GBP/USD
But the statement also showed most MPC members will like to wait for firmer evidence that wage growth will come before moving rates, not hawkish enough according to GBP/USD price action: the 4 hours chart shows price stalled at 1.6678, right below its 20 SMA in the mentioned time frame that maintains a clear bearish slope. Momentum maintains its bearish slope and stands near oversold levels, while RSI barely corrects higher, both well into negative territory. Furthermore, price retraced back to 1.6650 price zone, 200 DMA suggesting data is not enough to revert current bearish trend.
Some consolidation should be expected now, yet as long as the high holds, the upside will remain limited, with a break below 1.6600 putting the pair back in the bearish track towards 1.6540/60 price zone. A steady advance beyond 1.6680 on the other hand, may see price attempting a recovery towards 1.6730, where a daily descendant trend line coming from this year high should halt further advances.
View Live Chart for GBP/USD
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