Economists were not expecting such a surprise from the BoE, given the perseverance of its inflation which policy makers are trying to bring down.
However, most economists believed that the BOE would have used other programs such as the Funding for Lending Schemes (FLS) to boost its growth, because the economy is on a verge of triple dip recession. Investors are concerned about this split of 6-3 against further QE as when it last occurred (June 2012), it preceded an expansion of the QE program by £50 Billion.
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Technical Analysis
The price action has pierced the Bollinger band very sharply on a 30 minute time frame, leaving behind the moving average which is around 1.5416. This could be a good mean reversion opportunity, as price has moved away sharply from its mean. The RSI is also trading in an extreme over sold zone which usually calls for trend reversal.
Important Levels
Support Zone
1.5298-1.5266
Resistance level
1.5451-1.5427
DISCLOSURE & DISCLAIMER: The Above Is For Informational Purposes Only And Not To Be Construed As Specific Trading Advice. Responsibility For Trade Decisions Is Solely With The Reader.
by Naeem Aslam