GBP/USD attempting gains in Asia, leading to bullish MA crossover

The overnight selling interest in GBP/USD ran out of steam at 1.3104, opening doors for a move in the positive territory to 1.3160 and a bullish 5-DMA and 10-DMA crossover.

Awaits BOE rate decision

There is a widespread belief in the markets that Bank of England (BOE) will cut rates today. If it does not, the bank would at least strongly indicate that a rate cut and/or QE is coming in August.

The third scenario – bank stays pat and non-committal – is not being considered by markets at all. It remains to be seen how Cable reacts to a rate cut/dovish talk given the Pound has already a lost a significant value on Brexit vote and on anticipation of monetary easing.

GBP/USD Technical Levels

Acceptance above the immediate hurdle of 1.3206 (June 30 low) would expose 1.3315 (23.6% of 1.5019-1.2789). A break higher could yield 1.3533 (June 29 high). On the other hand, a breakdown of support at 1.3094 (5-DMA) – 1.3085 (10-DMA) would open doors for a slide to 1.30 levels (zero figure). A violation there could yield a re-test of 1.2789 (July 6 low).