#GBPUSD @ 1.12381 refreshes a two-week low after the BoE announced the expected 75 bps rate hike. (Pivot Orderbook analysis)

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• GBP/USD refreshes a two-week low after the BoE announced the expected 75 bps rate hike.
• A lower terminal rate than is currently priced in the markets weighs on the British pound.
• The Fed’s more hawkish outlook continues to boost the USD and exerts additional pressure.

The pair currently trades last at 1.12381.

The previous day high was 1.1565 while the previous day low was 1.1388. The daily 38.2% Fib levels comes at 1.1456, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.1497, expected to provide resistance.

The GBP/USD pair adds to its heavy intraday losses and drops a fresh two-week low after the Bank of England announced its policy decision. Spot prices, however, show some resilience below the 1.1200 mark and quickly bounce back closer to mid-1.1200s in the last hour.

As was widely anticipated, the UK central bank decided to raise interest rates by 75 bps – the biggest hike since 1989. In the accompanying policy statement, the BoE indicates a lower terminal rate than the 5.20% currently priced in the markets. This, along with a bleak outlook for the UK economy, prompts fresh selling around the GBP/USD pair amid strong follow-through US Dollar buying.

The Federal Reserve on Wednesday adopted a more hawkish stance and indicated that it will continue to raise interest rates to combat stubbornly high inflation. This, in turn, pushes the rate-sensitive two-year US government bond to its highest level since May 2006 and underpins the buck. Apart from this, a weaker risk tone offers additional support to the safe-haven greenback.

Market participants now look forward to BoE Governor Andrew Bailey’s comments at the post-meeting press conference for a fresh impetus. Apart from this, traders will take cues from the US ISM Services PMI to grab short-term opportunities around the GBP/USD pair.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.1252 at the time of writing. Pair opened at 1.1392 and is trading with a change of -1.23 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.1309, 50 SMA 1.136, 100 SMA @ 1.1715 and 200 SMA @ 1.2336.

The previous day high was 1.1565 while the previous day low was 1.1388. The daily 38.2% Fib levels comes at 1.1456, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.1497, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.1332, 1.1271, 1.1155
• Pivot resistance is noted at 1.1509, 1.1626, 1.1686

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