From March until mid June, the British Pound rose with 1000 pips against the USD! This solid up trend was fueled by increased risk appetite, no rate by the FED , but x2 the expected hike by the BoE. The Alligator indicator clear shows that bulls are in control, because all 3 EMAs point north. Demand for UK stocks is also high and this is why the international investors are buying GBP.

After it reached 1.28, GBP/USD corrected with 100 pips and is currently trading at 1.27. Although the drop, the price is still above the 10, 20 and 50 day EMAs. This is an indication that buyers are dominant and they dont let the price drop any further. It is very important to note that the surprise rate hike by the Bank of England is having a very positive effect on the local currency.

Things look slightly different however when we look at the 4H time frame. The 3 EMAs of the Alligator are now zig zagging. In addition the oscillators are high and the pound is not forming new higher highs. To see our anticipated price change in GBP/USD, please visit out Go Premium section.