GBP/USD finds support near 1.3210 ahead of BoE, PMI

Pablo Piovano FXStreet

The Sterling has recovered the ground lost during early trade, now prompting GBP/USD to return to the vicinity of 1.3230 after bottoming out near 1.3210.

GBP/USD all eyes on BoE

Cable is trading within a cautious range on Thursday ahead of the key BoE MPC meeting and Inflation Report expected afterwards.

Spot has been buoyant since the recent breakout of 1.3200 the figure, always on the back of the persistent weakness surrounding the greenback while headlines from the domestic scenario remain absent so far.

Ahead in the session, market consensus expects the key UK’s services PMI to come on the soft side after the mixed reports from the manufacturing and construction gauges seen in past sessions.

Regarding the BoE, strategists at TD Securities sees the central bank delivering a somewhat dovish message today, while attention should be mainly on the MPC vote: “We think that June was probably peak hawkishness for the MPC after a series of upside inflation surprises largely reversed in July. With little chance of a rate hike this week, we think that the market reaction to the BoE decision will depend on the result of the vote and the changes to the macro forecasts”, commented the strategists.

GBP/USD levels to consider

As of writing the pair is up 0.01% at 1.3224 facing the immediate hurdle at 1.3250 (2017 high Aug.2) followed by 1.3351 (high Sep.12 2016) and finally 1.3447 (high Sep.6 2016). On the other hand, a breach of 1.3188 (low Aug.1) would open the door to 1.3124 (10-day sma) and finally 1.3094 (23.6% Fibo of 1.2587-1.3250).

In addition, Cable is near overbought levels at 67 when gauged by the daily RSI (14), while the MACD stays on the bullish side for the time being.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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