The GBP/USD has been rallying in February from about 1.50 up to 1.5550 last week. This week, there has been a bit of a retreat. Let’s take a look at the technical picture ahead of the BoE on Thursday and US NFP on Friday.
The 4H chart shows the GBP/USD testing the 1.53-1.5350 area, which was a support/resistance area. A hold above 1.53 should maintain a bullish outlook, but what about below 1.53. We should take a step back to the daily chart and look at the big picture in preparation to Thursday BoE decision and Friday’s US NFP.
We can see that cable rallied from a low on the year at 1.4950 to 1.5550. This establishes a consolidation range so far, and the central pivot is in the 1.5223-1.5270 area. This is the area we should monitor. If the week closes above it, there should be more consolidation/bullish correction next week. Below it, we should look for a bearish continuation attempt at least to threaten 1.4950, with risk of falling towards 1.49.