At yesterday’s Bank of England (BOE) meeting, the policy rate was kept at 4.0% as expected. After this, the pound rose to 1.3660, but this became the day’s high, and then the pound started to fall. The BOE also announced a smaller reduction in its bond holdings (from £100 billion a year to £70 billion). Since the market expected £80 billion, the effect on selling the pound was limited.
Later, strong U.S. job data pushed U.S. long-term interest rates higher. This made the dollar stronger, and the pound fell to 1.3534. This continued the downward move that started the day before.
However, around 1.35, the pound stopped falling because of technical support from the 90-day moving average, the middle Bollinger Band, and the 61.8% Fibonacci retracement. If this level holds, the pound may restart an upward trend.
Expected GBP/USD range: 1.3480 – 1.3600 USD
Note: This information does not guarantee profits. Please make your own trading decisions.