• GBP/USD steadied on Tuesday as traders awaited the outcomes of the Fed and BoE meetings.
• The BoE is widely expected to cut rates a further 25 basis points to 4.25%, but the statement accompanying its decision will be closely watched by market participants.
• BoE policymakers have said Trump’s trade policies will hit growth although the impact on inflation is not yet clear.
• Fed is widely expected to keep rates steady but the spotlight will be on how policymakers are likely to navigate a tariff-ridden path.
•On the data front, UK services sector dropped in April for first time since Oct 2023, marking steepest decline in over two years as U.S. tariff worries weigh on exports and sentiment..
• UK services PMI dropped to 49.0 in April from 52.5 in March, marking sharpest drop since Jan 2023, slightly above flash estimate of 48.9.
• Immediate resistance is located at 1.3342(May 5th high), any close above will push the pair towards 1.3456(23.6%fib)
• Strong support is seen at 1.3241(38.2%fib) and break below could take the pair towards 1.3163(April 15th low).
Recommendation: Good to buy around 1.3310, with stop loss of 1.3260 and target price of 1.3400
