The immediate response for the Bank of England’s vote to hold steady and clear shift to a dovish stance in the breakdown saw the British Pound losing ground only to see a big bounce on weakness in the US weekly claimant data. While the change in policy bias for the BoE is clear absent any actual change market is more focused on US issues with the poor cliamant count seen as reinforcing the idea of the Fed loosening monetary policy. Ahead we have GDP figures for the UK the month-on-month consensus calling for a 0.1% read. We look to this data as a fresh catalyst with any negative read reversing the bullish technical scenario.
Resistance
- 1.26342 – 5/03 Spike High
- 1.25963 – 50 Fib Retracement Level
- 1.25718 – Daily Low / High
Support
- 1.25052 – Previous Intraday Consolidation Resistance
- 1.24667 – Previous Intraday Consolidation Support
- 1.24458 – Thursday’s Low
GBPUSD has given us an Engulfing Pattern in the Daily charts Thursday with the potential to develop into a ‘Three Outside Up’ pattern. Looking at the past two weeks or so we find the pair around the midpoint of a ranging market. Indicator wise the move has us with a bullish cross in oscillators and the bounce coming off 20D moving averages. Given this we are assuming a bullish bias to continue the wide range play. Intraday we have prices consolidating around the 38.2 Fibonacci Retracement level suggesting any further buys be taken only on a convincing push past the highs of the ongoing consolidation.
