GBP/USD Price Analysis: Bulls commit at a 61.8% ratio ahead of the Fed

GBP/USD bears are meeting demand at a 61.8% ratio support area.
Bulls are in control front side of bullish trend into he Fed.

Ross J Burland FXStreet

Sterling moved out of consolidation in the later part of the New York morning and is finding demand at a daily support area on the charts. However, at 1.1900, the pair is remaining precariously close to recent trend lows ahead of Wednesday's expected Fed 25bp hike.

A hawkish outcome could see GBP/USD back below Monday's low at 1.2799 as traders price a less-hawkish 25bp hike at the Bank of England's meeting on August 3.

The following illustrates the market structure on the daily chart and prospects of a move higher on a dovish outcome at the Fed:

GBP/USD daily chart

GBP/USD is still on the front side of the bullish trend and above last month's highs. Considering the long squeeze into the breakout traders of early July, at the 61.8% ratio, there is a case for the upside. However, it depends on the Fed.

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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