GBP/USD trades weak after dovish hike by BOE,sell on rallies : FxWirePro | November 3, 2017

Cable declined sharply yesterday following a 25bpbs hike by BOE. The central bank hiked rates as expected for the first time since 2007. But dovish hike by Central bank has pulled down the pound prices well below 1.3100. The pair dipped till 1.30398 at the time of writing. It is currently trading around 1.30570.

BOE revises potential GDP growth down to 1.5% on account of slack in labor market and slow growth in productivity. BOE is expected to have cautious approach for further rate hike and to have only 3 rate hike of 25bpbs for next three years.

Technically, pair is trading slightly below 1.3070 low mad e on Oct 0.20% 27th 2017 and any break below 1.30270 ( Oct 0.20% 6th 2017) will drag the pair till 1.2780 (233- day MA).

On the higher side, near term resistance is around 1.3080 (100- day MA) and any break above will take the pair till 1.3130/1.3175 (55- day EMA )/1.3230. Minor trend reversal only above 1.3380.

It is good to sell on rallies around 1.3080 with SL around 1.3150 for the TP of 1.2785.