In the near term future, the GBP/USD was expected to continue and reach the weekly R1 simple pivot point at 1.3181.
Bank of England Monetary Policy Report
The British Pound appreciated against the US Dollar, following the BOE Monetary Policy Report data release on Thursday. Note that the surge happened one minute before the official release at 12:00 GMT. The GBP/USD exchange currency rate gained 49 pips or 0.38%. The Pound continued trading at the 1.3080 level against the Greenback after the release.
Note that in December the Bank of England faced criticism over a security breach. The Bank's internal audio systems had been expropriated. Thus, hedge funds were able to get aware of the British policymakers' decisions before the official release.
The Bank of England published the Official Bank Rate data which came out in line with the expectations of 0.75%. According to the official release: "the Monetary Policy Committee voted by a majority of 7-2 to maintain Bank Rate at 0.75%. The Committee voted unanimously to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £10 billion. The Committee also voted unanimously to maintain the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £435 billion."
Economic Calendar
Relevant data publications for the GBP/USD will resume on Monday. At 15:00 GMT the US ISM Manufacturing PMI could cause a move on the GBP/USD from 16.2 to 28.9 pips.On some calendars, on Wednesday, the ADP Non-Farm Employment Change is shown as a high impact data set. Note that our analysts ignore it, as, for example, on the GBP/USD charts it has caused moves from 11.8 to 28.4 pips since September.
On the same day, the US ISM Non-Manufacturing PMI is scheduled to be released at 15:00 GMT. This event has caused GBP/USD moves from 20.6 to 37.8 pips.
Last but not least, US employment data sets are scheduled to be published on Friday at 13:30 GMT. GBP/USD moves from 21.7 to 51.3 pips have been caused by this event since September 2019.
The week's event historical data tables have been published. Click on the headline below to read the article.
GBP/USD short-term review
From the one hand, it is likely that some downside potential could prevail in the market. In this case it is unlikely that the currency pair could go below the 1.3045/1.3072 area due to the support cluster formed by the 55-, 100– and 200-hour SMAs, as well the weekly PP.On the other hand, the exchange rate could trade sideways in the 1.3120 area within the following trading session. Also, it is unlikely that bulls could prevail, and the rate could exceed weekly R1 at 1.3181.
Hourly Chart
On the daily candle chart, the rate trades above the 55-day SMA at 1.3050 and the weekly pivot point that is located at 1.3072.
In general, take into account how the SMA was being pierced and ignored by the rate since January 10. It appears that on its own, the 55-day SMA cannot impact the GBP/USD.
Daily chart
The sentiment had been almost neutral since Wednesday.
Meanwhile, trader orders were set to sell. In the 100-pip range, 63% of orders were to sell and 37% were buy orders.
The orders were 68% to sell on Thursday.