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InstaForex

August 4, 2021

BOE Meeting Closer, GBP/USD Traders Anger Slowly Creeping

 Investors are increasingly cautious about trading the Pound Sterling ahead of England's central bank policy meeting on Thursday making the British currency move more flat than last week.


On the chart of the GBP/USD currency pair, it can be seen that the price movement is more flat since the beginning of this week compared to the bullish pattern that has been displayed in the previous 2 consecutive weeks.


Not giving a clear signal of the direction of movement, the price hovered around the level of 1.39000 which is the support level for the price after last week's rise failed to reach the resistance level of 1.40000.


Possibly expectations for the Bank of England (BOE) to maintain loose policy in an effort to support the economy, made the Pound’s strengthening momentum start to fade back this week.




If the central bank delivers a dovish statement, investors will see the price fall again on the GBP/USD chart below the 1.39000 level towards the RBS (resistance become support) zone of 1.38000.



The further lower decline will lead back to the focus zone of 1.37000 and may reach back up to the support zone of 1.36000.


However, if the price increase is successful this week, the resistance zone of 1.40000 will be tested again to give an indication of the direction of further movement through the price reaction in that zone.


The break will strengthen analysts' expectations for the price to strengthen to reach a high of 1.41000 to hit the latest 6 -week high.