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11 Dec 2015
GBP/USD: oil weighs on the BoE minds - FXStreet
FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet explained the GBP/USD pair rose to a fresh 3-week high of 1.5201 during the European morning, an ahead of the Bank of England monthly decision.
Key Quotes:
"But the Central Bank economic policy meeting turned out to be a fiasco, as not only officers left its policy unchanged, but the Minutes showed that policymakers are concerned over falling oil prices, which are keeping inflation subdued, while wages are hardly expected to grow from now on.
The GBP/USD pair fell down to 1.5110 on the dovish tone, but managed to recover from there, and is back above the daily descendant trend line broken last Wednesday, currently at 1.5150 and the immediate support.
From a technical point of view, the 1 hour chart suggests that the risk remains towards the downside as the price is below a mild bearish 20 SMA, while the technical indicators hold in negative territory, unable to recoup above their mid-lines. In the 4 hours chart, the RSI indicator heads lower from overbought levels, but the Momentum indicator turned back higher after a limited downward corrective move, while the price holds far above a bullish 20 SMA, limiting chances of a downward move, but not yet supporting a rally past the 1.5200 level."
Key Quotes:
"But the Central Bank economic policy meeting turned out to be a fiasco, as not only officers left its policy unchanged, but the Minutes showed that policymakers are concerned over falling oil prices, which are keeping inflation subdued, while wages are hardly expected to grow from now on.
The GBP/USD pair fell down to 1.5110 on the dovish tone, but managed to recover from there, and is back above the daily descendant trend line broken last Wednesday, currently at 1.5150 and the immediate support.
From a technical point of view, the 1 hour chart suggests that the risk remains towards the downside as the price is below a mild bearish 20 SMA, while the technical indicators hold in negative territory, unable to recoup above their mid-lines. In the 4 hours chart, the RSI indicator heads lower from overbought levels, but the Momentum indicator turned back higher after a limited downward corrective move, while the price holds far above a bullish 20 SMA, limiting chances of a downward move, but not yet supporting a rally past the 1.5200 level."