A lot of what we’ve seen in recent weeks has been traders waiting for the Fed to back off on tightening because they’re used to being spoonfed liquidity. on Thursday after the Bank of England raised interest rates by 50 basis points, but more importantly, did not do so unanimously. So it is possible that the Bank of England could be one of the first to panic. Adding 50 basis points to the recession will almost certainly slow growth further, so the UK economy needs to be reassessed. Advertisement Put your technical skills to the test now! OPEN FREE DEMO ACCOUNT The 200-day EMA below is still an area of interest, so if we break below it, it is likely that this market would really open and open a drop-down to the 50-day EMA. It’s also probably worth noting that this is a massive outside candlestick, so it could be the beginning of the end of the uptrend. Granted, that’s a huge question right now, but it seems like we’re all rethinking it. Watch out for the next couple of days All things being equal, the 1.25 level provided major resistance, which was an area I thought was pretty important. If we continue to see the area offer some sort of ceiling, we can begin to continue the general downtrend. A lot of what we’ve seen in recent weeks has been traders waiting for the Fed to back off on tightening because they’re used to being spoonfed liquidity. After Thursday’s FOMC statement and press conference, it appeared that Jerome Powell is sticking to his guns and that tight monetary policy is a long-term feature of the economy. If we were to reverse the break above the 1.25 level, it is possible that the British pound could really rise. At this point I think you have a full trend reversal because frankly it is not that impossible that we can jump above the 200 day EMA to reverse and sell again. At the end of the day, it’s a situation where buyers have taken a big hit across the bow, but the next couple of days will really give us some insight.