GBP/USD Daily Forecast – British Pound Attempts To Rebound Against U.S. Dollar

British Pound Gains Some Ground Against U.S. Dollar

GBP/USD is moving towards the resistance level at 1.3230 while U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index is stuck near the resistance level at 96.50. In case the U.S. Dollar Index manages to settle above this level, it will move towards the resistance at 96.70 which will be bearish for GBP/USD.

There are no important economic reports scheduled to be released in the U.S. and UK today so foreign exchange market traders will focus on general market sentiment and COVID-19 news.

Markets expect that various countries will soon introduce additional virus containment measures which will put pressure on the global economy. However, markets look optimistic today. S&P 500 futures are moving higher, while WTI oil continues to rebound after yesterday’s sell-off. Treasury yields are mostly flat, and it remains to be seen whether the bond market is ready for significant moves ahead of Christmas.

Technical Analysis

GBP/USD did not manage to settle below the support level at 1.3200 and is trying to develop upside momentum. In case this attempt is successful, it will get to the test of the nearest resistance level at 1.3230.

A move above the resistance at 1.3230 will push GBP/USD towards the next resistance level at 1.3250. In case GBP/USD manages to settle above 1.3250, it will head towards the resistance which is located at the 20 EMA at 1.3270. A move above the 20 EMA will lead to the test of the next resistance at 1.3280.

On the support side, GBP/USD needs to settle below the support level at 1.3200 to have a chance to gain downside momentum in the near term. If GBP/USD declines below this level, it will move towards the next support level at 1.3170.

A successful test of the support at 1.3170 will push GBP/USD towards the next support level which is located at 1.3140. A move below this level will open the way to the test of the support at 1.3110.

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