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.
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