The decline of the GBP/USD has continued, as the currency exchange rate has reached below the 1.2700 level.
In the near term future, the pair was expected to reach for the support of a pivot point near 1.2635.
Bank of England Rate Cut
The British Pound depreciated against the US Dollar, following the UK Monetary Policy Summary release on Wednesday at 07:00 GMT. The GBP/USD exchange currency rate lost 56 pips or 0.44% after the release. The Pound continued trading at the 1.2900 level against the Greenback after the release.
The Bank of England decided to cut the Official Bank Rate to a target level of 0.25% at an unscheduled emergency meeting.
According to the official release: "Following the spread of Covid-19, risky asset and commodity prices have fallen sharply, and government bond yields reached all-time lows, consistent with a marked deterioration in risk appetite and in the outlooks for global and UK growth. Indicators of financial market uncertainty have reached extreme levels. The reduction in Bank Rate will help to support business and consumer confidence at a difficult time, to bolster the cash flows of businesses and households, and to reduce the cost, and to improve the availability, of finance."
Economic Calendar
The week's data is available. Click on the link below to see the historical data tables with the reactions to various events.
GBP/USD short-term review
Yesterday, the GBP/USD exchange rate breached the medium-term ascending channel south. During Thursday morning, the rate declined to the 1.2700 level. Note that the currency pair could continue to decline in the short term. In this case the pair could target the support level formed by the weekly S2 and the monthly S1 at 1.2636.If the pivot points manage to hold, the rate would trade sideways above the 1.2640 level. On the other hand, in the case of the pivots failing, the pair could reach for the 1.2600 level.
Hourly Chart
On the daily candle chart, the rate has passed the support of the large scale channel down pattern and the 200-day simple moving average.
On Thursday, the 200-day simple moving average began to provide resistance.
Daily chart
On Tuesday, the sentiment was 53% short. Traders continue to bounce around in the neutral zone.