FXstreet.com (Barcelona) - With the BoE policy meeting ahead at
12:00 GMT, the GBP/USD is pricing in expectations and trading with
daily gains today. A noticeable jump was seen recently, mostly due
to the successful Spanish debt auction that sent yields down. Spain
sold €5.87B, more than the €4-5B targeted: €3.397B of 2-year debt
at 2.476% (from 3.282%); €1.950B of 5-year debt at 3.988% (from
4.68%); €470M of 13-year debt at 5.555%. A good way to start the
year for Spain, as traders continue guessing when will Prime
Minister Rajoy ask for aid through the OMT programme.
The GBP/USD rallied from just above 1.6000 on the London session,
finding resistance at 1.6050 (high at 1.6052). TD Securities
analysts expect a non-event in the UK as the BoE announces its
rates and asset purchases decisions, unanimously expected to remain
on hold. "The bigger question for the BoE is what it will do at its
Feb meeting; we think that asset purchase will remain unchanged
then, but recognize that it could be a close decision, and that a
couple of weak datapoints have the potential to change the
picture", wrote analyst Alvin Pontoh.
"The market is viewed as having topped out last week - it reversed
just ahead of the 1.6452 2009-2013 downtrend and together with the
large divergence of both the daily and weekly RSI's, suggests that
the market has topped", wrote analyst Karen Jones, expecting
rallies to find interim resistance at 1.6135/80 that keeps the
immediate downside bias.