FX.co ★ GBP/USD analysis and forecast for July 29, 2021

It often happens in the market that you are waiting for some important event in the hope of some sensation. However, these expectations are not met. In my opinion, this can be fully attributed to yesterday's results of the July meeting of the US Federal Reserve System (FRS). Some market participants expected that the FOMC would indicate the timing of reducing the quantitative easing (QE) program. However, we heard the usual phrase that everything will depend on incoming macroeconomic statistics and the situation with the COVID-19 pandemic, namely with the rampant delta variant of coronavirus infection. More information about the results of the two-day FOMC meeting can be found in today's article on the euro/dollar.

I will only add that this meeting can be considered a passing one since the main interest rate remained in its previous 0-0.25% range. The rhetoric of the regulator has not undergone significant changes. The Fed's monetary policy will remain "dovish" until economic activity in the United States returns to pre-crisis values. The jump in inflation is still considered a temporary factor. And where is it without the standard phrase that the Fed will make every effort and use all the necessary tools to support the economy? Since the results of the FOMC meeting did not bring anything new, the US dollar fell under a wave of sales.

Daily

As a result of yesterday's growth, the GBP/USD currency pair still broke through the black 89-exponential moving average, after which it reached the level of 1.3908, where the 50th Fibo level passed from the decline of 1.4247-1.3570. Today, at the moment of writing, the pair continues to strengthen actively and is already trading near 1.3950, testing the strength of the blue 50-simple moving average. In principle, since the pair rose above the middle of its previous fall (it passed the 50 Fibo levels), it could be assumed that a trend change is taking place for this instrument. However, while the quote is trading below the most important price zone of 1.4000-1.4015, I would not rush to such conclusions. Moreover, in the case of passing up 50 MA, the pair will meet with the Ichimoku indicator cloud, or rather with both of its borders, which very often perform the function of strong resistance or support. In addition, today at 13:30 London time, preliminary data on US GDP for the second quarter will be released. I don't know how much they can influence the price dynamics of the US currency after the Fed meeting, but it is necessary to take these reports into account.

Regarding trading recommendations, positioning in both directions is still a possibility, while I still consider purchases to be the main trading idea. I suggest considering options for opening long positions after the pair drops to the price area of 1.3910-1.3880. Sales at this stage of trading are riskier, but if reversal patterns of candle analysis appear near the mark of 1.3970 on the four-hour and (or) hourly charts, you can try to sell, but with small targets, solely based on a correction.