The GBPUSD currency pair at a rate of 1.26614 is seeking to regain the level of 1.2700 because the difference in policies between the Federal Reserve and Bank of England seems likely to narrow after the Federal Reserve’s neutral policy decision.

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• GBP/USD is looking to reclaim 1.2700 as the Fed-BoE policy divergence looks set to squeeze after Fed’s neutral policy.

The pair currently trades last at 1.26614.

The previous day high was 1.2699 while the previous day low was 1.2601. The daily 38.2% Fib levels comes at 1.2662, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2638, expected to provide support.

The GBP/USD pair has witnessed a halt after a recovery extension to near 1.2670 in the European session. The Cable is expected to resume its upside journey as the policy divergence between the Federal Reserve (Fed) and the Bank of England (BoE) is set to squeeze.

Due to the significant softening of inflation, the United States managed to skip one more interest rate hike by the Fed. However, the BoE will continue hiking interest rates as inflation in the United Kingdom is significantly higher in comparison with other developed economies.

Meanwhile, Fed chair Jerome Powell has confirmed that two more interest rate hikes are appropriate this year while borrowing rates from the BoE are expected to remain in unchartered territory for now.

GBP/USD is gathering strength for printing a fresh annual high after climbing above the round-level resistance of 1.2700. Advancing 20-period Exponential Moving Average (EMA) at 1.2518 is providing support to the Pound Sterling bulls.

The Relative Strength Index (RSI) (14) has climbed above 60.00, showing no signs of divergence and any kind of overbought situation. This indicates an activation of the bullish momentum.

For further upside, an acceptance above the round-level resistance of 1.2700 will drive the Cable asset toward 26 April 2022 high at 1.2773 and the critical resistance of 1.2800.

On the flip side, a break below May 31 low at 1.2348 would drag the asset toward May 25 low at 1.2308. Slippage below the latter would expose the asset to April 03 low at 1.2275.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2666 at the time of writing. Pair opened at 1.2666 and is trading with a change of 0.0 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.2457, 50 SMA 1.2477, 100 SMA @ 1.2316 and 200 SMA @ 1.2032.

The previous day high was 1.2699 while the previous day low was 1.2601. The daily 38.2% Fib levels comes at 1.2662, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.2638, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.2612, 1.2558, 1.2514
• Pivot resistance is noted at 1.271, 1.2753, 1.2808

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