GBP/USD eases from tops, around mid-1.4000s as focus shifts to FOMC

   •  Upbeat UK wage growth data increases near-term BoE rate hike prospects.
   •  FOMC/BoE monetary policy update should help determine the near-term trajectory.
 
The GBP/USD pair trimmed some of the UK jobs data-led strong gains and has now retreated around 20-25 pips from session tops. 

The British Pound regained traction after the latest UK wage growth data revived BoE rate hike move in the near-future and lifted the pair to an intraday high level of 1.4076. Despite a strong up-move, the pair lacked any strong follow-through and remained below the 1.4100 handle.

Ahead of today's key event risk - the highly anticipated FOMC decision, investors seemed reluctant to place aggressive bets and could be one of the key factors keeping a lid on the pair's bullish momentum. 

Apart from the US monetary policy update, Thursday's BoE meeting would also play an important role in determining the pair's near-term trajectory. Against the backdrop of positive Brexit development, increasing prospects for a BoE rate hike might limit any immediate downside, at least for the time being.

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes, “the 4 hours chart shows that the price holds well above a bullish 20 SMA, while technical indicators hold well above their mid-lines, having lost upward strength amid the wait-and-see stance from market players rather than a sign of upward exhaustion. The pair has a relevant resistance area around 1.4070/80, as it topped multiple times around it these last few days, with scope to extend its gains up to 1.4145 on a break above it. To the downside, 1.4030 is the immediate short term support, with a more relevant one and a possible bearish target on a soaring greenback at 1.3960."