GBP/USD Daily Forecast – Test Of Resistance At 1.2880 -

GBP/USD Video 15.09.20.

British Pound Tries To Develop Additional Upside Momentum

GBP/USD is currently trying to settle above 1.2850 as the U.S. dollar remains under pressure against a broad basket of currencies.

Yesterday, GBP/USD made an attempt to gain more upside momentum above 1.2900 but this attempt did not succeed due to worries about a messy Brexit.

UK Prime Minister Boris Johnson managed to win an initial approval for his plan to breach the Brexit Withdrawal Agreement and break the international law “in a limited way”. However, this is not a final victory for Johnson, and more debate will follow.

UK has just provided Claimant Count Change and Unemployment Rate reports. In August, Claimant Count Change increased by 73,700 while analysts expected an increase of 100,000. Meanwhile, Unemployment Rate increased from 3.9% in June to 4.1% in July, fully in line with the analyst consensus.

While the market awaits interest rate decisions from the U.S. Fed and the Bank of England which are due to be announced later this week, GBP/USD traders will continue to focus on Brexit news and the general direction of the American currency.

The U.S. Dollar Index managed to settle below the support at the 20 EMA at 93.10 and is trying to develop downside momentum below the 93 level. In case the U.S. Dollar Index gets to the test of the next material support level at 92.50, GBP/USD will get an additional boost.

Technical Analysis

GBP/USD managed to get above 1.2850 and is testing the nearest resistance level at 1.2880. In case GBP/USD settles above this level, it will head towards the next resistance level at the 50 EMA at 1.3000, although it may also face resistance near the recent highs at 1.2920.

A move above the 50 EMA will open the way to the test of the resistance at the 20 EMA at 1.3035. The resistance area between the 50 EMA and the 20 EMA is set to be strong since a move above this area will signal that GBP/USD is ready to get back to the previous upside trend.

On the support side, the nearest support level is located at 1.2815. If GBP/USD moves below this support level, it will likely gain additional downside momentum and decline towards the next support at the recent lows at 1.2750.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.