This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
GBP/USD below $1.60
GBP/USD continues to trade below the $1.60 level and has given little indication over the last four trading days that it has the stomach for a fight. Tomorrow will see the Bank of England governor, Mark Carney, announce the latest UK inflation report. Ahead of this we might well see currency books being trimmed as the markets wait for the Bank of England’s assessment on the economic state of the union.
As has now become the norm, currency traders will be trying to judge the timeline for the BoE to start raising interest rates while Mark Carney will be trying to give as little away as he can manage. All of this should ensure that assumptions are jumped to and volatility remains in GBP/USD. The 50-hour moving average at $1.5860 along with the 100-hour moving average at $1.5895 should prove a barrier to any upside move.