GBP/USD Could Accelerate Its Slump On Another Slide Below 1.3900

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GBP/USD Current price: 1.3929

• The Bank of England hit the pound with an unexpected dovish statement.
•  As widely anticipated, the BOE left rates and easing programs on hold.
• GBP/USD could accelerate its slump on another slide below 1.3900.

The GBP/USD pair fell to 1.3889 despite limited demand for the greenback, as the pound was hit by the Bank of England monetary policy decision. As widely anticipated, policymakers left rates and easing programs on hold. However, the accompanying statement offered a dovish tone, the opposite of the expected hawkish stance.

"The Committee does not intend to tighten monetary policy at least until there is clear evidence that significant progress is being made in eliminating spare capacity and achieving the 2% inflation target sustainably." Market players were looking for a hawkish tilt, including some hints on when tapering may begin. The UK will publish the BOE’s Quarterly Bulletin for Q2 on Friday.

GBP/USD short-term technical outlook

The GBP/USD pair bounced from the mentioned intraday low but ended the day in the red at around 1.3930. In the 4-hour chart, the pair is below a still bullish 20 SMA, while technical indicators hover directionless around their midlines. In the daily chart, the pair is stuck around its 100 SMA for a third consecutive day, somehow hinting at an imminent directional acceleration.

Support levels: 1.3890 1.3850 1.3805

Resistance levels: 1.3965 1.4010 1.4060

Image Sourced from Pixabay

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.