01.08.201909:03 Forex Analysis & Reviews: Burning forecast for GBP/USD on 08/01/2019 and trading recommendation

After yesterday's surprise from the US Federal Reserve, today's meeting of the Board of the Bank of England can start playing with completely new colors. Even before yesterday evening, investors assumed that the Federal Reserve could lower the refinancing rate twice before the end of the current year. In this regard, the expected preservation of the Bank of England refinancing rate looked like a clearly favorable factor for the pound. However, after it became known that the Federal Open Market Committee reduced the refinancing rate from 2.50% to 2.25%, Jerome Powell said that there should be no more reductions. The market was waiting for something completely different and morally was already prepared to sell the dollar. But the words of the Federal Reserve chief mixed all the cards, and investors rushed to buy the dollar with a new force. Thus, the completely expected and predictable retention of the parameters of the monetary policy of the Bank of England does not look so positive anymore, and the pound is likely to continue to give up.

The GBP/USD pair, after a slight pullback from the level of 1.2150, has resumed the downward movement amid the rising dollar, as a result, it consolidated below the level of 1.2150. Considering the trading graph in general terms, we see that the British currency continues to storm the new low, as it currently fell to 1.2100.

It is likely to assume that the current background information will continue to hold pressure on short positions, where it is possible to consider the primary oscillation in the form of an amplitude of 1.2100/1.2150. After that, there is a process of monitoring consolidation points when placing further trading orders. If the quotation still succeeds in consolidating lower than 1.2100, then we will see a gradual descent towards the psychological level of 1.2000, but perhaps the course will be multi-stage.

Traders, in turn, are insured and are considering two options for the Buy/Sell move at once, depending on fixation points 1.2100/1.2150.

From the point of view of a comprehensive indicator analysis, we see that the descending interest exceeds all main time periods, thus indicator analysis tends to further lower the quotes.