Important events today:

19:00 UTC – US: U.S. Federal Reserve interest rate decision.

There are two reasons to buy the pound today. Firstly, there is a good demand on the British government debt market again, which is favorable for the pound quotes. In recent weeks the market of government debt defines trends in the British currency – in the periods of sales of government bonds the pound is cheaper, in the periods of rally in the debt securities the pound is more expensive. I would not say that there is a rally now, but there is demand, which cannot but rejoice.

Secondly, the positive dynamics of the oil market will give additional support to the pound, as the British currency historically correlates quite well with oil. The OPEC+ countries have started cutting their production of black gold and investors are waiting for the U.S. Department of Energy to replenish its strategic reserve, which has been pretty thin this year due to Joe Biden’s desire to cut energy prices before the elections in Congress.

The U.S. Congressional elections will be held next Tuesday and after that the U.S. Department of Energy will start buying oil for the strategic reserve, which, combined with OPEC+ production cuts, will form a steady upward trend in the oil market.

Recommendations: Buy 1.1474/1.1435 and TP 1.1570.