GBP/USD: Carney woke the bulls up
During the past week British currency has made another move up. GBP/USD rose above 1.5400 after the Bank of England released its Inflation Report. Inflation forecast for 2015 was revised down from 1.4% to 0.5%. Still, the central bank expects inflation to recover to the key 2% level in 2 years. Governor Mark Carney made some hawkish remarks hinting that the Bank of England won’t cut interest rates following the example of other central banks.
GBP/USD seems to be forming a medium-term low at 1.4950 these days. Inspired by Carney, the pair is testing the 55-day MA and the daily Ichimoku to the upside. Note that the daily MACD histogram has finally turned positive. Weekly close above the recent high of 1.5350 will open the way to 1.5475 (23.6% Fibonacci from the 2014 decline). Next resistance lies at 1.5800. Bulls will dominate the market above the 1.5200 mark.
UK will release a bunch of important figures on the new week. Watch the inflation data on Tuesday, the BOE minutes and labor data on Wednesday and the retail sales on Friday.