The Pound remains unchanged as the Fed failed to provide a clear opinion in regards to the future of their rate hike plan. Fed Powell initially stated that the U.S economy was performing well enough to explain a fourth rate hike this year but he also mentioned that the Federal Reserve is willing to cut rates if needed. The combination of these two statements confused the market and did not allow investors to reach a certain bias regarding the Fed's state of mind (hawkish or dovish). For today, the focus will remain on the U.S Dollar with the second quarter's Final U.S GDP set to be released later during the day. Investors need to continue monitoring any developments related to the Brexit negotiations.
As risk aversion returns to the market, the Pound broke below the 1.31513 support level, paving the way for a drop back towards 1.30535. Pound traders see no reason to push the pair up from these levels as no positive developments relating to Brexit occurred. Technically, the bearish momentum is set to continue on the short term given that the pair has also broken below the 13 and 50-period moving averages.
Support: 1.31513 1.30535
Resistance: 1.32017 1.32694