GBP/USD holds firm while USD/JPY and USD/CAD edge up as markets await Fed decision
The pound is steady against the dollar, while the US currency has moved up against the yen and the Canadian dollar.
GBP/USD clings to $1.27
GBP/USD finds itself stuck in a tight range, as it awaits the Federal Reserve (Fed) and Bank of England (BoE) decisions this week.
For the past two weeks the pair has essentially oscillated around $1.27. It has been unable to break higher, with gains stalled around $1.275. Conversely, weakness towards $1.265 has been met with buying.
It seems likely that this week’s central bank decisions will provide a resolution to the current situation.
USD/JPY under pressure after some hawkish Bank of Japan comments
The rally from late December has stalled in USD/JPY over the past two weeks, though hints of more hawkish commentary in the latest Bank of Japan (BoJ) minutes did knock the pair.
Sustained gains above ¥148.00 have proven impossible, though in the short-term buyers continue to defend ¥147.00. A close below ¥146.50 could mark a firm break to the downside, forming a lower high.
Alternately, a close above ¥149.00 breaks the range to the upside, and then targets the ¥149.70 highs from the second half of November. Beyond this lies the November peak just below ¥152.00.
USD/CAD retracement slows ahead of Fed decision
A lower high does appear to have been created here with USD/CAD. The price surrendered its hold on C$1.35 and has also slipped back below the 200-day simple moving average (SMA).
The bearish view was reinforced on Tuesday with a failure to move back above the 50-day SMA. Trendline support from the December low has also been broken.
A continued move lower could see the price target the December low around C$1.317, while a close back above C$1.35 would be needed to suggest the price is consolidating once more.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices
