The Bank of England was expected to expand its Bond purchasing program, aka Quantitative Easing from £275bn to £325bn. Economists had forecast a larger expansion of £75bn to £350bn. The sterling market had stalled it's recent strength coming into the BoE's scheduled meeting.

GBP/USD

GBP/USD

GBP/USD fell from 1.5927 down to 1.58 before finding support int he Asian-European session. QE in it of itself is negative for the currency, but the market was already expecting an expansion and actually less than forecast. Relatively therefore, this can be interpreted as GBP-positive. Failure to rally above 1.5875 (61.8% retracement of last session's bear run) would mean something wrong with the bullish continuation, especially if the RSI is rejected from going above 60. Otherwise, a push above 1.5927 opens up 1.61.

GBP/JPY

GBP/JPY

In the 1H chart, the GBP/JPY has a similar dynamic as the GBP/USD in that it retreated ahead of the BoE meeting. It fell from just above 122.70 to about 121.45. The RSI in the 1H chart fell to 40, but bounced off of it, reflecting maintenance of the bullish momentum. Now, it is pushing above 60, showing resumption of that bullish momentum.

The 122.70 area represents the 2012 high, which was just cracked (it is now near 122.85). In the previous update on the GBP/JPY, we noted that the bull run had a measured move targeting 124.35. 123.48 is also a level of interest being 61.8% retracement of the 127.32 to 117.26 bear run (Oct 2011-Jan.2012).

EUR/GBP

EUR/GBP

The EUR/GBP has been showing more Euro strength than Sterling, but the market held it under the 0.84 handle after the BoE expanded QE by less than forecast. The 1H chart however shows that there is support above 0.8330 as you see a confluence of factors: 1) rising trendline, 50% retracement, 200H simple moving average. Really, a break below 0.8315 is needed to show that the reversal is pushing for EUR/GBP to return to bearish mode, which first opens up 0.8263 and 0.8220. The RSI also will need to break below 40 and 30. Holding above 40, while price bounces back to 0.84 will be a sign that the market is more optimistic about the Greek deal, than it is surprised about the lower QE expansion by BoE.

GBP/CHF is also rallying after the BoE meeting, but inability to push above 1.45 will be a sign of weakness, and respect to a rounded top. The bearish target and previous support pivot at the moment is 1.4334. A break above 1.45 however, opens up 1.46 resistance pivot.

Make sure to join Nick and I at the IBTrade live market intelligence briefing at 8:00AM EST (13:00GMT) where we will cover the BoE decision as well as the ECB decision and press conference. To gain free access to live events register here at IBTrade. You will receive and email with the link and password before each session once you have registered.

Fan Yang CMT is the Chief Technical Strategist for IBTRADE, trader, educator, and a main contributor for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.