Home Event Bank’s of England hawkish rhethoric to support GBP

Bank’s of England hawkish rhethoric to support GBP

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Tool: GBPUSD

Position: Buy

(1 ratings, average: 5,00 of 5)

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Today we will see the finalization of the Bank’s of England meeting, which discusses its monetary policy. It is widely anticipated that the key components of the QE program and the interest rates will remain on its current levels. The key focus is dedicated to the allocation of votes of the Bank’s of England Board of Directors regarding issue of the rate maintainance on the same level of 0,5%, as well as the presence of the members within the board who have differing opinions. Currently, the market anticipates that two members of the board will vote in favor of the rate increase during the ongoing meeting, however, there may appear a third vote. This assumption was made with consideration of the improvement of the UK economy’s condition in accordance with the latest reports. This votes’ allocation will lead to the growth of the market expectations for, at least, one interest rate increase till the end of the year; it is also capable of reversing the GBP quotations towards mid-range growth.

From the perspective of the technical analysis, it is logical to expect the quotations’ growth. It is possible to highligh descending channel for GBP/USD at time H4 that has a support treadline within the range 1.3060-1.3090, from where it is easy to forecast the trend’s reversal. To conservative traders, we recommend to open long positions for the mentioned range if the following reversal formations of the technical analysis are present — takeover, or an upside down head and shoulders at time H1. Agressive traders can set a limit order for the purchase at the price of 1.3070 with a stop-loss of 1.3015. Quite large stop will be compensated with a potential for the pair’s growth, which is set at the point of 1.3630, where I recommed to set a take-profit for a mid-term position for the purchase.

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Bank’s of England hawkish rhethoric to support GBP

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