GBPUSD:
Sterling has corrected lower after a surge on the Fed headlines: the initial bullish impulse gave way to caution ahead of today’s Bank of England decision. The consensus expects the policy rate to be kept unchanged, and together with slowing inflation and weak real income growth this leaves only limited room for further short-term appreciation of the pound.
The UK faces subdued activity and a mortgage burden that is sensitive to interest rates, so the regulator is keen to keep financial conditions stable. Markets have already partially priced a softer dollar; any more restrained BoE guidance on the path of future easing could trigger moderate profit-taking in long GBP/USD positions.
At the same time, the global backdrop after the Fed decision supported the dollar via firmer yields and softer risk appetite. Against this background, selling the pair from current levels with a tight stop-loss and a realistic target within the daily range looks tactically sound.
Trade recommendation: SELL 1.3625, SL 1.3675, TP 1.3575
Origin: FreshForex
