On February 3, the Bank of England published its Monetary Policy Summary. The bank hiked its interest rate by 0.25% to 0.50%. In addition, the central bank Monetary Policy Committee voted unanimously to start to reduce its stock of bonds. Namely, the bank is starting quantitative tightening.
On the release, the GBP/USD suddenly dropped by 23 base points or 0.17%, before immediately recovering. In a span of 15 minutes, the rate gained 62 points or 0.46%. On the hourly candle chart, the rate's volatility found support in the 50-hour simple moving average near the 1.3550 level.
Economic Calendar
On Friday, the US is going to publish employment data at 13:30 GMT.
There will be one notable event during the next week. On Thursday, the publication of the US Consumer Price Index and US Core Consumer Price Index data at 13:30 GMT is set to impact the value of the US Dollar. Note that at the same time, the weekly US Unemployment Claims will be published.
On Friday, February 11, at 07:00 GMT, the UK Preliminary quarterly Gross Domestic Product data will be published. A GBP move on all Pound charts can be expected.
Click on the link below to find out more about data releases of this and other currency exchange rates.
GBP/USD short-term review
In the near term future, a continuation of the surge of the GBP against the USD could aim at the resistance of the 1.3600 mark. However, the 1.3600 level was pierced during the high volatility. Due to that reason, it is expected that the rate might reach the weekly R2 simple pivot point at 1.3650.Hourly Chart
GBP/USD daily chart's review
On the daily candle chart, the rate appears to be ignoring technical levels, as the 50 and 100-day simple moving averages did not manage to impact the currency exchange rate for more than one trading session. Namely, the two SMAs had acted as resistance.Next target for the surge of the pair is the 200-day simple moving average, which reversed the rate's surge in mid-January.
Daily chart
Read More: Technical Analysis
Short sentiment increases
On Thursday, traders were mostly bearish, as 64% of trader open position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 57% to sell the GBP against USD.
On Wednesday, 62% of volume was short and 68% of orders were to sell.
On Thursday, traders were mostly bearish, as 64% of trader open position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 57% to sell the GBP against USD.
On Wednesday, 62% of volume was short and 68% of orders were to sell.