Current trend

GBP is trading within the downward trend against USD.

After early May’s sideways correction, the pair broke the key support level of 1.3480 and continued to fall. In less than two trading weeks, the instrument lost another 250 points and stopped at a strong support level of 1.3205. Yesterday and this morning, GBP restored a part of the loss, grew to the upper border of the downward channel 1.3295, could not cross it and went down. Now the price is 1.3270.

At the end of the trading week, the traders will focus on the US releases: Initial Jobless Claims, Unemployment Rate, and Nonfarm Payrolls publications. In the UK, Mortgage Approvals and Gfk Consumer Confidence will be published.

Support and resistance

In the short term, a sideways consolidation and a further definition are expected. From the current level, a long upward correction with the target at 1.3450 is possible. However, the downward trend may be strengthened if US Employment Market releases are positive, which will increase the possibility of the further tightening of monetary policy and support the dollar. In this situation, a breakdown of the current minimum at 1.3205 and a fall to the level of 1.2835 is possible.

Technical indicators confirm the forecast, MACD keeps a high volume of short positions, and Bollinger bands are directed downwards.

Resistance levels: 1.3270, 1.3295, 1.3350, 1.3380, 1.3410, 1.3500.

Support levels: 1.3225, 1.3205, 1.3180, 1.3150, 1.3110, 1.3050, 1.2835.

Trading tips

It is better to open short positions from the current level and open pending short positions from the levels of 1.3410, 1.3450 with the target at 1.2835 and stop loss 1.3530.

Great Britan vs US Dollar

BuySellSpread
1.278591.2783821

Scenario

TimeframeWeekly
RecommendationsSELL
Entry Point1.3286
Take Profit1.2835
Stop Loss1.3530
Support levels1.2835, 1.3050, 1.3110, 1.3150, 1.3180, 1.3205, 1.3225, 1.3270, 1.3295, 1.3350, 1.3380, 1.3410, 1.3500

Alternative scenario

RecommendationsSELL LIMIT
Entry Point1.3410, 1.3450
Take Profit1.2835
Stop Loss1.3530
Support levels1.2835, 1.3050, 1.3110, 1.3150, 1.3180, 1.3205, 1.3225, 1.3270, 1.3295, 1.3350, 1.3380, 1.3410, 1.3500
GBP/USD: general analysis

The material published on this page is produced by the Claws&Horns Company and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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