The US dollar still failed to strengthen against other major currencies heading into the end of the week after the Fed raised interest rates by 75 basis points at the FOMC meeting yesterday morning.
Adding to the decline in the performance of the US dollar when the release of gross domestic product (GDP) data of the United States (US) recorded a contraction for the reading figures for the second quarter.
GDP data recorded a decline to -0.9%, missing expectations to increase to 0.4% following a contraction in the first quarter of -1.6%. Technically, the contraction situation for two consecutive quarters is a signal of the US economic recession.
Meanwhile, after the FOMC meeting, investors' focus will shift to the Bank of England's (BOE) policy meeting next week for the August edition with an expected interest rate increase of 25 basis points.
The Pound currency has seen a gloomy movement throughout the week, but is still moving better against the volatile US dollar until the end of the week. The situation may change in the following weeks.
Watch the price action for the GBP/USD currency pair, prices in Asian trade yesterday moved more slowly below the 1.22000 resistance zone, failing to extend the previous surge during the reaction to the FOMC meeting.
And in the middle of the European session, the price plunged around 90 pips.
However, the price that fell almost touching the 1.21000 level bounced back on trading that continued to the New York session heading back to the 1.22000 zone.
The price movement is flat around the 1.21700 level in Asia this morning (Friday) after closing the previous session trading around that with expectations for prices to continue rising further before the closing of this week's trading curtain.
For the expectation of a higher increase that will continue, the 1.22000 barrier zone will be breached for the price to record the latest 4-week high level with the target for the next increase being towards the 1.23000 height zone.
On the other hand, if the price shrinks and shows signs of a change in the bearish trend again after this, the price will retest the support level of 1.21000 first before showing a clearer downward pattern.
Next, a further drop in price will lead to the 1.2000 level before continuing a lower decline to a concentration level around 1.19400.
