GBP/USD consolidates hawkish BOE-led rally around 1.2350

Having peaked at fresh weekly tops near 1.2375 region in the overnight trades, the GBP/USD has entered a phase of bullish consolidation, in the wake of surprisingly hawkish BOE policy decision, with one dissenter in Kirsten Forbes, who voted for a rate hike.

The major rallied more-than one big figure on BOE’s policy announcement from near 1.2265 to 1.2377 levels. The pound was boosted across the board in tandem with the UK bond yields on the back of Forbes dissent.

However, it remains to be seen if the BOE will hike rates amid uncertainty over the MPC, as Forbes quits this June and Hogg has already resigned, leaving considerable uncertainty about the future course of the BOE monetary policy program.

Also, cable finds support from the recent optimism on the Article 50 trigger and broad based US dollar weakness, as Wednesday’s less hawkish FOMC decision hangover persists.

With the key central banks’ event behind, focus now shifts towards the G20 meeting and BOE’s quarterly bulletin ahead of the US datasets due later in the NA session.

GBP/USD Levels to consider            

Valeria Bednarik, Chief Analyst at FXStreet notes, “The 4 hours chart shows that the pair has settled above 1.2345, the 50% retracement of the January rally and February's monthly low, while the price has advanced far above a bullish 20 SMA, and also beyond the 200 SMA for the first time this March.”

“Technical indicators in the mentioned time frame have lost upward momentum and turned fat in overbought territory, not enough to confirm a downward move. Additional advances expose the 1.2425 level, the 38.2% retracement of the same rally. Support levels: 1.2345 1.2300 1.2260 Resistance levels: 1.2380 1.2425 1.2470.”