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The pair continues to trade near the support region around 1.40 which is likely to be the ground for battle between the bulls and the bears in the short term. I is unlikely to have a conclusion today as today is a holiday in many parts of the world in continuation of the Easter Sunday. So the volatility and the liquidity is expected to be very low today as well.
GBPUSD Near Support
The pair had made a move just beyond the 1.42 region a couple of weeks back on the back of the weakness in the dollar and also due to the hawkish BOE which continues to see a stronger economy and a smoother Brexit process. The process continues in a slow, steady and consistent manner and there is less than a year for the process to officially get completed. The UK economy has help up well so far, in fact the process has been going so smooth and the economy has been doing so well that the BOE could afford to make a rate hike during this period.
The continuation of a strong economy would be helpful for the BOE to consider even more rate hikes in the near future and this is what is helping to keep the BOE hawkish. All these led to the pair moving to the highs of its short term range but then, it faced a lot of selling due to a strengthening of the dollar and as a result of that, we are now seeing the pair hovering around the important support region of 1.40. If this support breaks, then the bears would regain control.
Looking ahead to the rest of the day, we do not have any major news from the US or the UK and the holiday in many parts of the world would ensure that the liquidity and hence the volatility would be low for the day.
This article was originally posted on FX Empire