GBP/USD firm near 1.3300 ahead of BoE

Cable’s upside stalled just below 1.3300 the figure overnight.
BoE is poised to hike rates after a decade.
Speculations points to a ‘dovish hike’.

Pablo Piovano FXStreet

The Sterling keeps the weekly upside well and sound despite Wednesday’s pullback and is now pushing GBP/USD to the vicinity of the 1.3300 handle, or session tops ahead of the BoE event.

GBP/USD all attention to the BoE

Cable is reverting yesterday’s retracement and keeps navigating the upper end of the range just pips away from the critical barrier at 1.3300 the figure.

GBP remains underpinned by solid expectations of a rate hike by the Bank of England at today’s meeting. However, previous market chatter over the likelihood of a ‘dovish hike’ could prompt investors to quickly ‘sell the fact’ and thus put the British Pound under renewed pressure.

Recent auspicious results from UK’s manufacturing PMI and advanced GDP figures for the third quarter keep underpinning the sentiment around GBP and somewhat reinforce the view of higher rates today.

In the US docket, the usual report on the labour market is due along with Challenger job cuts and speeches by FOMC’s J.Powell (dovish, permanent voter), Atlanta Fed R.Bostic (2018 voter, centrist) and NY Fed W.Dudley (permanent voter, centrist),

Further out in the US, attention remains on Trump’s announcement of the next Fed Chief (likely to be Jerome Powell) and Republicans should introduce the tax bill in Congress.

GBP/USD levels to consider

As of writing the pair is gaining 0.25% at 1.3279 and a breakout of 1.3299 (high Nov.2) would aim for 1.3338 (high Oct.13) and finally 1.3499 (2014-2017 resistance line). On the other hand, the next support emerges at 1.3210 (10-day sma) seconded by 1.3189 (55-day sma) and then 1.3070 (low Oct.27).

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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