As expected in yesterday's article on the GBP/USD currency pair, the Bank of England's decision on rates and subsequent comments may change the technical picture. That's what happened. Few people expected that the Bank of England would change its monetary policy at its meeting yesterday, and it remained unchanged. But the British Central Bank signals that the bond-buying program may end in December of this year were a pleasant surprise for the bulls in the British currency and pushed the sterling exchange rate up. Naturally, this decision will still depend on the incoming macroeconomic statistics and the situation with the COVID-19 pandemic.
Nevertheless, such a signal was received. In today's economic calendar, at 15:00 London time, three speeches of Fed representatives are scheduled at once. The main one will be the speech of the US Federal Reserve System chairman, Jerome Powell.
Daily
So, after the decline shown at the auction on September 22, the pound/dollar pair showed impressive growth yesterday, absorbing the previous bearish candle. Can this be considered a reversal signal? I believe that, to a greater extent, yes. Yesterday's trading on GBP/USD closed at 1.3715, and the orange 200-exponential moving average prevented the pair from further moving northward. It is the 200 EMA that is blocking the pair's way up at the moment of writing this article. However, as they say, it is not yet evening. However, passing up the 200 exponential still does not guarantee an easy and quiet life for the bulls on the pound since the blue Kijun line and the red Tenkan line of the Ichimoku indicator is concentrated a little higher in the price zone near 1.3760. It is quite logical to assume that from a technical point of view, it is here that the pair can meet very strong resistance, on overcoming which the subsequent prospects of the British currency in pair with the US dollar will depend.
It is also necessary to keep in mind that the lower border of the Ichimoku daily cloud is higher, and the simple moving average, which is located at 1.3784, is even higher than 50. Thus, in my personal opinion, only the passage of all these obstacles and a confident consolidation above the strong and important technical level of 1.3800 will open up prospects for further growth for the pair. The bears have the same tasks for the tool. First, it is necessary to lower the quote below the level of 1.3600, after which it is necessary to make a true breakdown of the key support level of 1.3570. If we consider the trading priorities for today, then after yesterday's strong growth, purchases look like the main trading idea. I suggest taking a closer look at the opening of long positions after short-term declines in the area of 1.3700-1.3680 and the appearance of characteristic candle signals for growth there at this or smaller time intervals. Sales will also become technically justified if bearish candles appear on H4 and H1 near 1.3737, 1.3745, and around 1.3760. I do not recommend setting large goals. On Monday, considering the completion of weekly trading, more information may appear, and therefore trading ideas.
