GBP/USD: more room for growth?
The Bank of England official pushed the sterling higher on the past week, hinting on the need to raise interest rates. As a result, GBP/USD jumped to January highs above the 1.5500 mark. However, for now the price faced resistance at 1.5550, failing to break above the daily Cloud. We see space for more bullish movement as markets are currently underestimating the BOE hawkish intentions. Strong resistance will be seen at 1.5800. GBP offers even more interesting trade opportunities against EUR or the commodity currencies.
On the new week pay attention to the PMI indices – they will likely confirm ongoing the economic recovery. The Bank of England holds its policy meeting on Thursday. No changes in policy are expected, but we’ll examine the MPC rate statements for signals.