The 50 SMA Holds for GBP/USD, Now Sellers Reappear After the FED and the BOE
Skerdian Meta • 1 min read
The GBP/USD turned bullish back in March, together with all major forex pairs, as the USD started to turn massively bearish, based on ideas that the US might as a country might come to an end. But, that seems unrealistic now, and traders are starting to regain confidence in the USD.
The statement from the FED on Wednesday evening didn’t sound too dovish; instead, they sounded sort of optimistic after the data from recent months, which shows that the economic rebound continues in the US. As a result, the USD turned bullish overnight, with the GBP/USD losing around 100 pips.
This pair retreated from 1.30, where the 50 SMA (yellow) was providing resistance, but the 20 SMA held as support and the GBP/USD bounced off that moving average. However, the 50 SMA held as resistance again, and the GBP/USD reversed down again after remarks by the Bank of England. The BOE commented on negative rates, and the markets took it as a dovish signal. So, the GBP/USD turned downwards, and after such price action, it seems like this pair is turning bearish in the long term now.