The UK pound was helped to strengthen against many currencies by an inflation report and the words of the BoE’s Broadbent. The pound/dollar renewed to 1.5240 after the FOMC minutes were published and today in Asia the rate left the five day corridor.
The break in the upper limit opens the road up to the U3 for the bulls. I didn’t bother considering a sharp GBP/USD growth, although it will be important to keep an eye on the euro/pound cross. If the pound will be strong, due to a general dollar weakening we could see a growth which is stronger than that of the euro.
There are not any pound sellers out there. The GBP/USD is back up to the daily LB. If the day closes above 1.5255, I’ll have a strengthening of the pound to 1.5400 in mind. With such a price pattern from a 1.5929 maximum (18th June, 2015), I don’t see anything else happening.
We better forget about our 1.4900 target for the meanwhile. Market participants decided to reduce their long positions on the USD after the FOMC minutes came out.