GBP/USD remains muted on the last trading day of the week. The pair remained pressured below 1.3830 as it failed to cross the level for the past few sessions.

At the time of writing, GBP/USD is trading at 1.3794, up 0.02% for the day.

The market seems to be fully discounting the  Bank of England’s (BOE) rate hike expectations in November. Nick Bennenbroek, International Economist at Wells Fargo said after the initial November hike, there is an expectation for another 25bps increase in May 2022 and a further 25 bps in November 2022, which means ending the BOE’s policy rate cycle by the next year-end at 0.75%.

The Brexit-led optimism failed to uplift the sentiment surrounding the sterling, in the wake of the positive comments from UK Prime Minister Boris Johnson on the NI protocol.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES : (TECHNICALS)

GBPUSD is hovering around the ichimoku cloud after managing to break above the exponential moving averages 200 and 50 in the daily time frame. 1.3800 is acting as a strong price action which the cables is failing to conquer while another major resistance awaits the pair at 1.3870. GBPUSD has somewhat taken an exit from our bearish channel and also reversed all the losses by taking over 50% and 61.8% fibo retracement levels. For further confirmation of the upside projections, the pair needs to break above 1.3800 - 1.3820 in order to rally towards 1.3870 and higher. An impulsive bearish closing below 61.8% fibo would open doors for a further fall towards 50% fibo zone at 1.3536. 

GBPUSD

Oct 22 2021