- The British Pound recently traded towards 1.2892 against the US Dollar where it found support.
- The GBP/USD pair broke a minor bearish trend line at 1.2925, and currently attempting break above another at 1.2945 on the hourly chart.
- Recently in the US, the Minutes of the Federal Open Market Committee June 13-14, 2017 were released.
- The minutes pointed out concerns over the effect that their recent measures and the outlook for inflation.
GBP/USD Technical Analysis
The British Pound recently traded lower from the 1.3025 swing high against the US Dollar, and closed below the 1.3000 handle.
The GBP/USD pair moved below the 1.2960 support area and traded as low as 1.2892 where it found support and started a recovery.
The pair recovered and managed to clear the 23.6% Fib retracement level of the last decline from the 1.3027 high to 1.2892 low.
GBP/USD Hourly Chart
It recently broke a bearish trend line with resistance at 1.2925, which is a positive sign and has opened the doors for more gains in the near term.
At the moment, the pair is attempting a break above another bearish trend line at 1.2945 on the chart. The trend line also coincides with the 38.2% Fib retracement level of the last decline from the 1.3027 high to 1.2892 low.
Once it breaks 1.2945-50, there can be a move towards the 1.2980-1.3000 levels which is the next major hurdle for buyers. Buying in the short term might be considered, but gains could be limited by 1.3000.
FOMC Meeting Minutes
Recently in the US, the Minutes of the Federal Open Market Committee June 13-14, 2017 were released. The market was expecting a positive outlook on the inflation and their stand on interest rates.
However, there were difference of opinions in the minutes, and there were concerns over the effect that their recent measures and the outlook for inflation.
The fed stated that:
Most participants viewed the recent softness in these price data as largely reflecting idiosyncratic factors. A third rate hike this year remains a solid base case, but also that such a hike is unlikely to come before the December meeting.
Overall, the GBP/USD pair might correct further towards 1.2960-80, but the upside move could be limited by 1.3000.