GBP / USD consolidates daily gains around 1.3100 ahead of FOMC decision

• The pound recovers from key technical support but does not hold above 1.3100.
• US Dollar Under Pressure As US Vote Counting Continues

The GBP/USD it is rising sharply on Thursday, but has so far failed to break above Wednesday’s high. The pound remains volatile in a wide range, supported by a decline in the US dollar across the board and hovering around 1.3100.

The dollar is under pressure. It managed to stabilize during the final hours before the FOMC decision and as market participants await the headlines about the US presidential election. The DXY is down 0.90% and tested the October low. On Wall Street, the major indices were up about 1.60%, below their highs.

From a technical perspective, GBP / USD continues to move in a range, supported by the 100-day moving average at 1.2895. On the upside, it is facing a difficult time staying above 1.3100. Key resistance is seen around 1.3150.

After the BoE, now it’s the Fed’s turn

Now market participants await the outcome of the FOMC meeting. Earlier on Thursday, the Bank of England announced an increase in its asset purchase program by 150 billion, a higher number than expected. “The Bank of England also said that purchases are expected to last until the end of 2021, which leaves the main number less moderate than it appears at first. At the same time, the Bank of England appears to remain wildly optimistic about growth prospects through 2021-22, so we are still comfortable with our view that more QE will need to be announced in mid-2021, albeit with the largest increase. today in QE stocks, the announcement can probably wait until the third quarter of 2021 instead of the second quarter, ”explained TD Securities analysts.

The Fed is unlikely to surprise the markets, and considering the focus is on the elections, it’s a gathering that market participants might ignore.