The Great Britain Pound (GBP) inched lower against the US Dollar (USD) on Thursday, decreasing the price of GBPUSD to less than 1.2275 ahead of the Bank of England (BoE) monetary policy announcement. The technical bias has turned bullish after the emergence of bullish engulfing candle yesterday.
As of this writing, the pair is being traded near 1.2267. A support can be noted around 1.2200 (a short term horizontal support area as well as psychological number) ahead of 1.2109 (low of the bullish engulfing candle emerged on Wednesday) and then 1.1986 (the low of 2017).
On the upside, a hurdle may be noted around 1.2437 (the trendline resistance area) ahead of 1.2700-1.2706 (the high of last major upside move & psychological number) and then 1.2774 (the high of December 6th, 2016) as demonstrated in the given above daily chart. The technical bias shall remain bullish as long as the 1.2109 support area is intact.
BoE Monetary Policy
The Bank of England (BoE) is scheduled to announce its monetary policy today. According to the average forecast of different economists, all 9 members of the Monetary Policy Committee (MPC) are likely to vote in favor of no change in the benchmark interest rate. The central bank is also likely to maintain its asset purchase program at £435b.
Considering the overall technical and fundamental outlook, buying the pair around current levels appears to be a good strategy in short to medium term.