GBP/USD Bounces Off Support Line on Meeting Minutes

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The meeting minutes from the last meeting of the BoE showed that there’s still one member voting for a rate hike. This helped GBP/USD bounce off the support line, after it got very close to it. Update on the Pound.

Andrew Sentance continues to vote for a rate hike. He’s still the only member out of 9 that wants a rate hike, but his voice is heard. The Pound leaped from 1.5545 to 1.5610 immediately after the release, and the move isn’t over:

Update: As of 9:45 GMT, GBP/USD already reached 1.5660! Very strong move.

A continued move could send the pair back to 1.5720, an area it failed to break yesterday. Above, 1.5833 and 1.60 are the next levels of resistance.

Earlier this week, British inflation continuing falling, slowly returning to the target range. CPI still stands on 3.1%, but Core CPI fell sharply to an annual rate of 2.6%. Mervyn King, the governor of the BoE, expressed “surprise” from the higher inflation, but remained certain that it will fall. He reiterated his stance that the high prices are mostly the result of higher taxes.

The Pound struggled after this release, but later fully digested the news and dropped from the vicinity of the 1.5720 resistance line all the way to the other end of the spectrum – the 1.5520 support line. It opened the London session with an attempt to break lower and pushed forward after the MPC Meeting Minutes.

A new move downwards, would send the pair first to support at 1.5520, and then to 1.5470 and 1.5350.

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Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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