GBP/USD

Traders eye on Thursday the BoE announcement of its key rate. The BoE is expected to leave its monetary policy unchanged in May at 0.5%.

SERVICES PMI- review

April saw another marked increase in the UK services sector activity, with growth again supported by a sharp increase in volumes of incoming new work. Companies kept on top of workloads by adding to their payroll numbers, reflecting sustained confidence in the economic outlook.

After accounting seasonal factors, the headline Business Activity Index recorded 58.7 in April. That was up from March’s 57.6 and marked the sharpest increase in activity of 2014 so far. Growth has now been recorded for 16 straight months.

Technical view-

The pair has been in an uptrend from 1.6465 levels, currently it is extending its bullish leg up to 1.70 and 1.7036 levels. The RSI in the daily chart indicates the pair will start its downward journey at any time. It's not safe to enter longs at the cmp. Traders can enter shorts at the cmp or at higher levels at 1.7036 for targets at 1.6823, 1.6763 and 1.67 (50SMA) levels. On the down side, the pair has strong support at 1.6823 levels, the major bearish view will rise only below this level.

In Asia's trading session, the pair is trading at 1.6972. In the H4 chart, the hourly momentum indicators are giving a clear sell call for 1.6945, 1.6921, 1.6907, 1.6880, 1.6853 and 1.6823 levels. The bear grip will tighten only below 1.6823 for 1.6760 levels.

We expect the selling will take place in the evening session. From the cmp the pair will move a bit higher and start falling from there (1.70-1.7036) cmp 1.6974 levels.