As expected, the GBP/USD has traded sideways below the weekly S3 at 1.2186 and above the 1.2150 level.
The currency exchange rate is expecting the central bank announcements of this week. Namely, the FOMC announcements will be made on Wednesday at 18:00 and Bank of England on Thursday at 11:00 GMT.
Main focus on central banks
This week top attention will be paid to the US Federal Reserve's Federal Open Markets Committee announcements on Wednesday at 18:00 GMT.
In general, the markets expect a US Dollar interest rate cut. Besides that each monetary policy announcement since November 2018 has caused a move on the GBP/USD in the range from 23.4 to 53.8.
In addition, note that the financial media might comment and look at the US ADP Non-Farm Employment Change that is scheduled to be published on Wednesday at 12:15 GMT.
However, historical data reveals that during the time period of five minutes before the release and five minutes afterwards the GBP/USD has moved from 6.8 to 15.6 pips since August 2018.
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
The GBP/USD has traded sideways in a narrow range between 1.2150 and 1.2180 since the afternoon London trading hours of Tuesday.From a technical analysis perspective, the rate should trade sideways until the resistance of the 55-hour simple moving average approaches and pushes it down.
On the other hand, take into account that the central bank announcements today and tomorrow will crash technical charting, if price adjustments to the new information take place.
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 made.
Daily chart
Read More: Technical Analysis
Traders remain long
On Tuesday, 70% of open GBP/USD position volume on the Swiss Foreign Exchange was in long positions.
The sentiment became 73% long on Wednesday.
Meanwhile, trader set up pending orders in the 100-pip range were bullish, as 56% of orders were set to buy and 44% were to sell.
The sentiment became 73% long on Wednesday.
Meanwhile, trader set up pending orders in the 100-pip range were bullish, as 56% of orders were set to buy and 44% were to sell.