Technical analysis of GBP/USD pair

This week was shaking for the cable. At the beginning of the week, the pound continued the Friday’s downward trend.

However, it little changed ahead of the Bank of England’s meeting. Although the BOE kept interest rates unchanged at the level of 0.5%, hawkish sounding statements of the Governor made the pound rise. Mark Carney said that they are returning to targeting inflation at the two-year horizon. That is why they may raise the interest rate earlier than planned before. It caused the rally of the pound, and it could achieve the level of 1.4065 after the last close at 1.3875. However, the candle could not close at that height and fell to close at 1.3900.

The bullish trend of GBP could not fix because doubts about the Brexit deal still prevail. In addition, the significant plunge of the Dow Johns Index affected the pound as well.

The GBP/USD is moving in a horizontal trading channel between 1.3835 and 1.4000. They are support and resistance for the pair in a short-term. The next support is at 1.3741, resistance at 1.4070.

Next week traders should take into consideration CPI data that will be released on Tuesday, February 13, and Retail Sales announcement on Friday, February 16, both at 11:30 MT time.

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Darya Bobrova