GBP/USD
In the first half of this trading week, the GBP/USD pair has been holding steady above the key range of 1.2700-1.2650, making efforts to continue its upward movement. However, the Bank of England meeting today could change everything for this pair. Depending on the outcome of the meeting and how the market reacts to the decision made by officials, the pair could either climb to 1.2860 or drop to 1.2600. There is also a possibility that the pair might continue its sideways trend, which has been ongoing for more than four weeks.
Experts are anticipating the following outcomes from today’s Bank of England meeting:
– The interest rate is likely to stay at 5.25%.
– It is expected that 7 officials will vote to keep the rate unchanged, while 2 may vote for a rate cut.
If there are any significant changes in officials’ positions and a shift in the current balance occurs, we could see a sharp increase in volatility for the pound.
Based on the technical analysis of the GBP/USD pair on the daily timeframe, we can see the formation of a slow-moving “piercing candle” pattern. If the pair manages to hold above 1.2700, we might see a retest of 1.2860-1.2800. However, if the support at 1.2660 is broken, there is a possibility of the pair resuming its downward trend towards 1.2600-1.2540.
USD/JPY
Buyers of the dollar in the USD/JPY pair are making consistent efforts to remain above 158.00. The loose monetary policy of the Bank of Japan and the hawkish stance of the Federal Reserve could lead to a potential approach to the psychological level of 160.00.
From a technical standpoint, the USD/JPY pair is showing a strong upward trend across various higher timeframes. On the D1 chart, a “bullish engulfing” pattern was formed after a corrective pullback earlier in the month. If buyers can maintain levels above 158.00, we might see another attempt at reaching 160.00. However, if the support at 157.60 is breached, a short-term downward correction could start.
There are some key news events that may impact the pricing of the pair:
– The Philadelphia Fed Manufacturing Index (USA) for June is scheduled for today at 15:30 (GMT +3:00).
– The number of initial jobless claims in the USA will also be released today at 15:30 (GMT +3:00).
– Tomorrow at 02:30 (GMT +3:00), the nationwide core Consumer Price Index (CPI) in Japan for May will be announced.
In conclusion, the decisions made at the Bank of England meeting today could greatly influence the direction of the GBP/USD pair, while the USD/JPY pair continues to be influenced by central bank policies and economic indicators. Traders should stay informed about these developments to make well-informed trading decisions.