As of writing, GBP/USD was trading near the level of 1.2691, which is an important short-term support level (200 EMA on the 1-hour chart).
If market participants react negatively to the outcome of tomorrow's Bank of England meeting, and Powell makes hawkish comments regarding the prospects of the U.S. central bank's monetary policy, which in turn gives the dollar a new bullish impulse, then a break of this level and the significant long-term support level of 1.2650 could signal a resumption of short positions on GBP/USD. The nearest downside targets are the support levels at 1.2544 (200 EMA on the 4-hour chart) and 1.2510 (50 EMA on the daily chart). Breaking through these levels, in turn, could trigger a deeper decline of GBP/USD, potentially reaching the key medium-term support levels of 1.2335 (144 EMA on the daily chart) and 1.2300 (200 EMA on the daily chart).
In an alternative scenario, GBP/USD will resume its rise. A confirmed breakout of key long-term resistance levels at 1.2800 (200 EMA on the weekly chart) and 1.2848 (50 EMA on the monthly chart and local high) will propel the pair into the zone of a long-term bullish market, directing it towards the upper boundary of the upward channel on the weekly chart and the strategic resistance level of 1.4335 (200 EMA on the monthly chart), which separates the GBP/USD global bear market from the bull market.
The quickest signal for the realization of this scenario may come after the break of the short-term resistance level at 1.2760 (200 EMA on the 15-minute chart).
Support levels: 1.2691, 1.2650, 1.2544, 1.2510, 1.2335, 1.2300
Resistance levels: 1.2760, 1.2800, 1.2848, 1.3900, 1.4335
