The Pound has continued to gain since hitting low water marks before going into the weekend. Traders are anticipating Thursday’s Bank of England pronouncements and an expected interest rate hike.
Pound Climbs Off Lows from Friday
The Pound has climbed off lows seen last Friday in a convincing manner. The British currency is near the 1.32 level against the U.S Dollar and its short-term momentum has been solid.
Investors are likely positioning themselves before the Bank of England’s anticipated interest rate hike on Thursday. But it will be Governor Mark Carney’s Monetary Policy Summary and pronouncements which will move the market going forward.
Bank of England Anticipated
The Pound’s short-term gains are retracing values the Pound has traversed earlier this month, the 1.3350 level should be viewed as important resistance.
If the Bank of England delivers exactly as expected on Thursday. And raises their interest rate by a quarter of a point, but essentially says they believe another hike will not be needed in the mid-term, the Pound could reverse lower before the weekend.
A Speculative Pound with Reversals Likely
The Pound will be speculative leading up to Thursday’s monetary policy outlook.
Traders should anticipate a wide range to develop over the next two days. Support for the Pound appears to be around the 1.31 level against the U.S Dollar, however, traders may be looking for additional value today.
In the short term, we believe the Pound may be positive. Mid-term and Long-term we are unbiased.
Yaron Mazor is a senior analyst at SuperTraderTV.
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