- The GBP/USD pair is attracting buyers above 1.2200 on Friday.
- The pair maintains bullish RSI conditions above the 50-hour and 100-hour EMAs.
- The first resistance level is located at 1.2217. 1.2170 serves as the initial support level.
The GBP/USD pair remained in positive territory for the second consecutive day in early European trading on Friday. As widely expected, the Bank of England (BoE) decided on Thursday to keep interest rates unchanged at 5.25%. Central bank governor Andrew Bailey said in a press conference that further rate hikes may be appropriate, but he dismissed the idea of cutting rates. The major currency pair is currently trading around 1.2208, up 0.08% on the day.
According to the 4-hour chart, GBP/USD is above the 50-hour and 100-hour exponential moving averages (EMAs), which supports buying for now. Additionally, the Relative Strength Index (RSI) is above 50 in bullish territory, suggesting the path of least resistance is towards the upside.
That said, the immediate resistance level for the major pairs will appear at the confluence of the upper Bollinger Bands and the October 16th high of 1.2217. A decisive breakout above the latter will push it up to 1.2288 (October 24th high). Further north, the next barrier to watch is his 1.2300 (round number) on the way to his 1.2337 (October 11th high).
On the downside, the 100-hour EMA at 1.2170 serves as the first support level. An additional downside filter appears around the Bollinger Bands’ lower limit of 1.2115. The main contested levels are in the 1.2095-1.2100 area, representing the psychological mark and October 20th low. A break above this level will result in a fall to the October 26 low of 1.2066.