GBP/USD: Bank of England. Scenarios

Last Thursday, the Bank of England held its third meeting this month. According to the results of the previous two, which were unplanned, the Bank of England sharply lowered its interest rate to almost zero (0.1%) and raised the volume of bond purchases to 645 billion pounds.

Yesterday, Bank of England executives unanimously voted to maintain interest rates at 0.1% and current bond purchases volume. The bank's management said it would “continue to closely monitor the situation” and “ready to take further measures if necessary” to protect the economy from the influence of coronavirus.


The pound reacted rather restrainedly to this event - it was expected. Nevertheless, the growth of GBP/USD continues, mainly due to the weakening dollar. Futures on the DXY dollar index fell on Thursday for the 5th day in a row. At the beginning of today's European session, the DXY dollar index futures are trading near 99.61, 390 points below the closing price last Friday. Investors still welcomed the efforts of the US government and the Fed to support the economy.


Since the beginning of this week, GBP / USD has been growing, having strengthened by 7% and rising during today's European session to the level of 1.2305 and the resistance level of EMA144 on the 4-hour chart.


If the growth continues, the immediate goal will be the resistance level 1.2435 (ЕМА200 on the 4-hour chart), and the next goal - the resistance level 1.2735 (ЕМА200 on the daily chart).
Nevertheless, below the resistance level of 1.2735, the global long-term downtrend of GBP / USD is maintained, and if the pair returns to the area below the support level of 1.2000, the bearish trend may resume.


The first signal to resume sales will be a breakdown of the local support level of 1.2140.
In an alternative scenario, a break into the zone above the resistance levels of 1.2735, 1.2860 will resume the bullish trend of GBP / USD with the prospect of growth to resistance levels of 1.3000, 1.31000, 1.3210 (Fibonacci level of 23.6%), 1.3280, 1.3510, 1.4350 (highs of 2018).


Support Levels: 1.2200, 1.2140, 1.2000, 1.1915, 1.1800, 1.1700, 1.1600, 1.1500, 1.1410
Resistance Levels: 1.2305, 1.2435, 1.2590, 1.2735

Trading Scenarios
Sell ​​Stop 1.2130. Stop-Loss 1.2310. Take-Profit 1.2100, 1.2000, 1.1915, 1.1800, 1.1700, 1.1600, 1.1500, 1.1410
Buy Stop 1.2310. Stop-Loss 1.2130. Take-Profit 1.2435, 1.2590, 1.2735