Due to the announcement of the head of the Federal Reserve the GBP/USD dropped. Namely, it was announced that there will most likely be no more rate cuts this year.
From a technical perspective, the rate was fluctuating above the support of the 1.2100 level. In general, the rate was expected to continue to decline, as soon as it is approached by the resistance of the 55-hour simple moving average.
Bank of England incoming
Main event in the UK will occur on Thursday at 11:00 GMT. The Bank of England will announce its monetary policy. Namely, the rate, votes on the rate, Inflation Report and Monetary Policy Summary will be published.
The event has caused moves from 21 to 43.5 pips since November 2018.
In addition, on Thursday the ISM Manufacturing PMI will be published at 14:00 GMT. This event has caused moves from 13.2 to 25.4 base points.
On Friday, the US employment data will be published. It will consist of the US Average Hourly EARNINGS, Non-Farm Employment Change and the official Unemployment Rate. This release has caused moves from 14.8 to 34.1 base points.
GBP/USD short-term review
On Thursday morning, the GBP/USD was fluctuating above the 1.2100 level, which was providing psychological support that forms near round levels.Meanwhile, the rate was being approached by the resistance of the 55-hour simple moving average, which on Thursday morning was located at 1.2160. In general, the rate was expected to be pushed down by the simple moving average.
On the other hand, if the SMA fails, the rate would retest the resistance of a weekly pivot point at 1.2186.
Hourly Chart
On the daily candle chart, the dominant descending channel pattern's lower trend line, which held the pair up since May, has been broken.
An update to the large scale patterns will be made as soon as the central bank announcements are over.
Daily chart
Read More: Technical Analysis
Traders remain long
On Wednesday, 73% of open GBP/USD position volume on the Swiss Foreign Exchange was in long positions.
Meanwhile, trader set up pending orders in the 100-pip range were neutral, as 52% of orders were set to sell and 48% were to buy.
Meanwhile, trader set up pending orders in the 100-pip range were neutral, as 52% of orders were set to sell and 48% were to buy.