Lots of ups and downs today
The GBPUSD is trading above and below the unchanged level today at 1.2915. The low extended to 1.2892. The high moved to 1.2947. The 100 hour MA is above at 1.2963. The 200 hour MA is below at 1.2881. The price is not far from the midpoint between those two extremes. The price did move below a trend line today. The underside of that trend line comes in at 1.29315 currently. There is a lot of neutrality technically. A move above the broken trend line at 1.29315 would tilt the bias more bullish.
Like the BOC, the BOE has been more hawkish of late. At the last meeting 3 members voted for a hike (vote was 5-3). Gov. Carney was not there but is getting closer (he was more hawkish in comments last week).
As Adam points out, today is the 10 year anniversary since last hike in rates in the UK. That is a long time. People get itchy. The 10-year itch might eventually lead to a hike especially if inflation remains above the target 2% level for an extended time period. The more hawkish mindset should keep a bid in the GBPUSD pair, but the technicals still need to keep a bullish bias. For me, a move below the 200 hour MA would weaken the bullish bias and would likely signal a stronger USD or change in the BOE stance back to the more dovish.
Today, the service PMI came in weaker than expectations at 53.4 vs 53.6 (and 53.8 last), but it remains comfortably above the 50 level (been above 50 for 11 months).
