GBP/USD pair reached a daily high of 1.2833 after the Bank of England (BoE) surprised markets with a 0.50% rate hike, but we quickly saw a technical correction.
According to the 4-hour chart, we can see that the pound has broken sharply the uptrend channel formed since May 31, but could have difficulties as there is strong support around 1.2680.
Since June 13, the British pound has been making a technical correction and at the same time has been forming a secondary downtrend channel. It could mean that if it trades above 8/8 Murray, we could expect a technical rebound in the next few hours and GBP/USD could reach 1.2756 and even the zone +1/8 Murray located at 1.2817.
On the other hand, a daily close below 1.2670 could mean a change in the trend of the British pound and GBP/USD could reach 7/8 Murray around 1.2573, the level which coincides with the EMA 200 located at 1.2562.
In case the British pound continues to rise in the coming days, we should expect a daily close above 1.2830. Then, the pound could continue its upward trend and reach 1.2939 (+2/8 Murray).
Our trading plan for the next few hours is to wait for the British pound to reach 1.2695 to buy with targets at 1.2756 and 1.2817. On the other hand, if the British pound trades below 1.2670, it will be seen as a clear signal to sell with targets at 1.2662 (200 EMA) and 1.2451(6/8 Murray).
