#GBPUSD @ 1.10435 mixed signals about BoE’s bond-buying program prompt some short-covering around . (Pivot Orderbook analysis)

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• mixed signals about BoE’s bond-buying program prompt some short-covering around GBP/USD.
• Subdued USD price action provides an additional lift, though the uptick lacks bullish conviction.
• Investors now look to FOMC minutes for a fresh impetus ahead of the US CPI report on Thursday.

The pair currently trades last at 1.10435.

The previous day high was 1.118 while the previous day low was 1.0953. The daily 38.2% Fib levels comes at 1.104, expected to provide support. Similarly, the daily 61.8% fib level is at 1.1093, expected to provide resistance.

The GBP/USD pair stages a goodish bounce from the 1.0925 area, or a nearly two-week high set earlier this Wednesday and snaps a five-day losing streak. Spot prices, however, struggle to capitalize on the move and retreat around 40-50 pips from the vicinity of the 1.1100 round-figure mark.

The British pound attracts some buyers amid reports that the Bank might be willing to extend its purchases beyond Friday and prompts short-covering around the GBP/USD pair. This, along with subdued US dollar price action, offers additional support to the major. That said, BoE Governor Andrew Bailey said on Tuesday that the central bank will stop buying UK government bonds on October 14. Apart from this, the dismal UK macro data contributes to capping the upside for the major.

The UK Office for National Statistics reported that the economy unexpectedly shrank by 0.3% in August, reinforcing the BoE’s prediction for a recession this year. Furthermore, expectations that the Fed will continue to tighten its monetary policy at a faster pace to tame inflation acts as a tailwind for the greenback. This further holds back traders from placing bullish bets around the GBP/USD pair ahead of the crucial FOMC meeting minutes, due later during the US session.

The focus will then shift to the latest US consumer inflation figures on Thursday, which should play a key role in influencing the Fed’s future rate-hike path. This, in turn, will drive the USD demand in the near term and provide a fresh directional impetus to the GBP/USD pair. In the meantime, elevated US Treasury bond yields might underpin the greenback and continue to keep a lid on any meaningful gains for the major amid concerns about the UK government’s fiscal plans.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.1053 at the time of writing. Pair opened at 1.0968 and is trading with a change of 0.77 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.118, 50 SMA 1.157, 100 SMA @ 1.1889 and 200 SMA @ 1.2513.

The previous day high was 1.118 while the previous day low was 1.0953. The daily 38.2% Fib levels comes at 1.104, expected to provide support. Similarly, the daily 61.8% fib level is at 1.1093, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.0888, 1.0807, 1.0661
• Pivot resistance is noted at 1.1114, 1.1261, 1.1341

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