GBP/USD analysis: BOE's upward momentum offset by dollar's strength
|GBP/USD Current price: 1.3910
- BOE to raise rates probably sooner and at a faster pace.
- UK trade balance industrial and manufacturing production to set the tone Friday.
The Sterling soared against all of its major rivals following BOE's monetary policy meeting, with the GBP/USD pair hitting a daily high of 1.4066, as Carney said that rates probably need to rise sooner and at a faster pace than what the central bank thought three months ago. Furthermore, the central bank upgraded its growth forecast amid the global economic recovery, but also added that inflation is expected to remain close to recent levels, and slightly higher than the projection made in the November's meeting. The market lifted chances of a May hike afterward, despite Carney warned about Brexit uncertainty. The UK will release this Friday Industrial and Manufacturing Production figures for December, alongside with the latest trade balance data. The strong upward momentum seen at the beginning of the day has been offset by dollar's strength, as in the 4 hour chart, the rally stalled around the 50% retracement of the latest daily decline, and is now back below the 23.6% retracement of the same rally, having broken below a bearish 20 SMA, while technical indicators retreat from their mid-lines. The US session low at 1.3890 is now the immediate support, with a break below the level probably favoring a retest of the 1.3830/40 region, where the pair bottomed multiple times this week.
Support levels: 1.3890 1.3860 1.3835
Resistance levels: 1.3960 1.4000 1.4055
View Live Chart for the GBP/USD
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.