GBP/USD holds onto the post-Fed gains while picking up bids towards the recent peak surrounding 1.2200, close to 1.2185 by the press time of Thursday’s Asian session.
That said, a one-month risk reversal (RR) of the GBP/USD pair, a spread between the calls and the puts, jumps the most in five weeks by the end of Wednesday’s North American session, with the latest RR figure being +0.265. In doing so, the options market signal snap the previous three-day downtrend.
It’s worth noting, however, that the weekly scenario remains in favor of the GBP/USD bears as the week-on-week RR prints a three-week downtrend while also flashing the most negative figures since late April, around -0.620 by the press time.
Given the short-term bullish bias for the GBP/USD pair, in contrast to a bit broader bearish forecasts, the traders may wait for the Bank of England’s (BOE) monetary policy decision for taking fresh positions.