GBP/USD pops in the open to test 1.2200

GBP/USD bulls move in at the start of the week.
Markets look ahead to this week´s BoE and Fed.

Ross J Burland FXStreet

The US Dollar fell on Friday sending GBP/USD to test 1.22 the figure although further declines in the shares of Credit Suisse and First Republic Bank rattled markets and weighed on the pair later in the day. However, UBS is said to take over Credit Suisse in a deal aimed at stemming what was fast becoming a global crisis of confidence which is putting a bid back into the pair. GBP/USD is up by some 0.2% and trading back in the 1.22s.

The UBS and Credit Suisse deal is expected to be closed by the end of this year. Colm Kelleher, chairman of UBS Group, said the agreement "represents enormous opportunities". He also said that his bank's long-term aim would be to downsize Credit Suisse's investment banking business and align it with the "conservative risk culture" of UBS.

Meanwhile, markets will look ahead to this week´s events in the Federal Reserve and Bank of England interest rate decisions. The BoE is expected to hike by 25bp on 23 March bringing it to 4.25%.

´´Markets are currently pricing around 15bp for the meeting, thus close to an equal implied probability for an increase of 25bp in the Bank Rate and an unchanged decision,´´ analysts at Danske Bank said. ´´While the latest UK economic data releases, in our view, still support a 25bp hike on Thursday, we acknowledge that the probability of the BoE keeping the policy rate unchanged has risen considerably amid rising systemic risk fears. This risk is only supported by what we consider to be a fairly cautious Monetary Policy Committee (MPC).´´

As for the Fed, analysts at TD Securities expect a 25bp rate hike, taking the Fed Funds rate to 4.75%-5.00%. ´´Post-meeting communication is likely to emphasize that the Fed is not done yet in terms of tightening (also reflected in a slightly more hawkish dot plot), with officials also flagging the more uncertain economic environment, resulting in an even larger emphasis on data dependence.´´

GBP/USD

Overview
Today last price	1.2206
Today Daily Change	0.0031
Today Daily Change %	0.25
Today daily open	1.2175

Trends
Daily SMA20	1.2029
Daily SMA50	1.2141
Daily SMA100	1.2049
Daily SMA200	1.1892

Levels
Previous Daily High	1.2201
Previous Daily Low	1.21
Previous Weekly High	1.2204
Previous Weekly Low	1.201
Previous Monthly High	1.2402
Previous Monthly Low	1.1915
Daily Fibonacci 38.2%	1.2162
Daily Fibonacci 61.8%	1.2138
Daily Pivot Point S1	1.2116
Daily Pivot Point S2	1.2058
Daily Pivot Point S3	1.2015
Daily Pivot Point R1	1.2217
Daily Pivot Point R2	1.2259
Daily Pivot Point R3	1.2318

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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