GBP/USD bottomed earlier at 1.5275, the lowest level since October 14 and then rebounded. Currently is gaining upside momentum as it climbs above 1.5300, where the hourly 20-MA stands. Currently it trades at 1.5300/05, marginally below the level it closed yesterday. Many of crosses are trading in granges awaiting the outcome of the Fed meeting. GBP/USD traded all day so far in a range of less than 40 pips. Volatility is expected to pick up during the next hours.
The Federal Reserve is expected to leave rates unchanged today and most analysts also think that they will remain at current levels during the rest of the year. The statement will be watched closely and any indications that it could raise rates in December could boost the US dollar, pushing GBP/USD to the downside.
According to Dylan Eades from ANZ, “a period of consolidation beckons in the near-term for GBP/USD”. He sees the market sceptical of Mark Carney, BoE Governor, intentions to raise rates. But Eades also notes that the underlying economic fundamentals of the United Kingdom remain relatively encouraging.