GBP/USD has been on the backfoot lately with price falling more than 150 pips after touching 1.2880 level a couple of weeks ago.
We witnessed a false breakout of the resistance level and since then, GBPUSD is on a downtrend. With FOMC on Tuesday, we could have wild swings on all USD pairs including GBP/USD.
So, we recommend traders to be careful as price could fall further to 1.26 and even lower if Federal Reserve decision is not in line with market expecations.
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That being said, we are seeing some amount of support in the 4H chart. So, if the 1.2620 level holds, price could make a recovery to 1.2750 or beyond
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Price is still hovering around the 4H dynamic support level