GBP/USD outlook

Source: Dukascopy Bank SA
Currency pair saw increased volatility, closing at the 7 week low- 1.33990.

Economic Calendar


Higher than usual volatility levels may be anticipated, if fundamental data releases from both the United Kingdom and the United States are taken into consideration.

GBP/USD hourly chart analysis

GBP/USD chart shows a corrective rally that is now testing a major confluence of resistance, which will be a critical test for this recovery. After a significant downtrend, the price found support at the 1.3340 level and has since staged a rally up to this key decision point. The powerful resistance cluster is formed by the horizontal level at 1.3459 and the 100-period and 200-period moving averages. While the price is above the short-term 50-SMA, the longer-term moving averages are still pointing down, confirming the overall bearish pressure. The reaction here is key: a strong rejection from this zone would suggest the primary downtrend is still in control, while a decisive breakout above the 200-SMA would be needed to neutralize the bearish outlook.

Hourly Chart

GBP/USD daily candle chart analysis

GBP/USD daily chart shows the price has broken down to test a critical long-term support level at 1.3400, putting the market at a major crossroads. After a sell-off pushed the price below its 50-day and 100-day moving averages, the reaction at this 1.3400 support is now key; a strong bounce would suggest the range is still in play, while a decisive close below it would be a very bearish signal..

Daily chart


Traders are long
Building on the trend from previous weeks, most traders now expect a bullish move in the FX pair, primarily due to persistent softness in the U.S. dollar.




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