In contrast to other more flat major currencies, the Pound Sterling showed a clear decline in its trading value last week following England’s central bank policy meeting.
The Bank of England (BOE) delivered a dovish -toned statement on their monetary policy after interest rates were announced to remain at lows at 0.10%.
Although the US dollar displayed a horizontal movement, the Pound more clearly showed a decline as shown on the chart of the GBP/USD currency pair.
The price has shown a bearish pattern until the end of last week after the rise initially managed to reach the resistance level at 1.4000.
However, the price started giving signals for a bearish trend after the price declined from the 1.4000 level moving below the Moving Average 50 (MA50) barrier level on the 1 hour time frame of the price movement on the GBP/USD chart.
After moving horizontally around the 1.39000 level, the price closed last week’s trade slightly lower below that level before trading resumed earlier this week around the same price area.
With the bearish pattern expected to continue, the price is seen to continue the decline this week towards the support zone at 1.38000.
If the price manages to break through the support zone, the target for a lower decline is seen around the 1.37000 level.
On the other hand if the price makes a rise above the level of 1.39000 and passes the MA50 barrier, investors will be wary for a bullish trend signal again.
The bulls will first test the resistance level at 1.4000 before signaling the direction of further price movement.
