Ahead of the Bank of England ”super Thursday”, will Cable take a bow or fly above the 1.3000 psychological level? Will Governor Carney be overwhelmingly positive today? A look at GBPUSD daily technical outlook Pre-BoE meeting.
11 May, AtoZForex –The GBP remains firm ahead of the “Super Thursday” releases of the BoE policy decision and the central bank’s inflation report. The focus is on whether the dissent evident at the last policy decision, when Forbes voted in favor of a rate increase, has strengthened or weakened; consensus expectations suggest the status quo will prevail but this will perhaps be the primary focus for the markets over the next few hours or so. Since the last BoE meeting, there have been more improvements in the UK economy. Wages and inflations are healthy on the upward slope. However, housing activity is slowing while consumer spending remains weak. It is pertinent to know what the BoE thinks today since the economy keeps doing greatly even after Brexit. Governor Carney has been concerned about how the economy will perform under Brexit. But the economy slow down being anticipated seems to be a mirage. If they are overwhelmingly positive today, or more than 1 member dissents, Cable could easily fly above the 1.30 psychological level and hit 1.3050. However, if they remain cautious and downplay recent improvements, Cable should weaken across boards.
GBPUSD daily technical outlook Pre-BoE meeting; Daily Chart
Looking at the daily chart above, the price has broken above the upper end of the channel. Ideally, the price should aim for the resistance at 1.3050 region as indicated by the horizontal line in the chart above. However, The prolonged consolidation and price action seen so far after the aggressive rally which took spot to the top of its daily range has taken a shape of a bearish flag pattern. In other words, if a rally does happen to the 1.3050 zone, it could easily find its way back to the 1.2850 region. However, a strong rally and a daily close above 1.3050 will expose 1.3200 and even 1.3400 going forward.
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