Current trend

Yesterday, the Pound dynamics were volatile but the pair managed to strengthen towards the end of the day. The GBP was pressured by the poor data on Markit Services PMI for July in the UK and the Retail Sales figure from the eurozone that came out worse than expected. However, the GBP gained a little after a release of the ADP Employment Change in the US.

Today, the Bank of England Interest Rate Decision (interest rates are expected to stay the same), BoE Minutes and the Quarterly Inflation Report are due in the UK.

Support and resistance

Bollinger Bands on the daily chart is showing flat. MACD is slowly growing and is giving a weak buy signal. Stochastic after a short fall is turning up again.

Consider short-term long positions, however it is advised to wait for clearer indicators signals.

Support levels: 1.5520 (local low), 1.5465 (24 July low), 1.5400, 1.5330 (8 July low).

Resistance levels: 1.5645 (local high), 1.5700, 1.5770, 1.5800 (24 July high), 1.5850, 1.5900, 1.5930 (18 June high).

Trading tips

Open long positions after the price rebound from the level of 1.5600 (with the appropriate indicators signals) with the target at 1.5700 and stop-loss at 1.5220.

Short positions can be opened after the breakdown of the level of 1.5520 with the target at 1.5400 and stop-loss at 1.5600.

GBP/USD: Pound is strengthening prior to Bank of England meeting

GBP/USD: Pound is strengthening prior to Bank of England meeting

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