Article Hero

GBP/USD Price Forecast: Critical Levels to Monitor

1605536969.jpg
Miguel A. Rodriguez
Miguel A. Rodriguez
05 November 2022
Last week, a bullish momentum pushed GBP/USD to a multi-week high. Will the upward trend survive this week, or will the EU-UK updates reverse the price direction?

Cable Technical Overview

  • Critical days for EU-UK free trade deal
  • Positive outlook while above 1.3185

Deal or No Deal? 

The UK and the EU have entered another intense round of negotiations in Brussels however, time is running up. Nonetheless, the top PM advisor Dominic Cumming’s resignation last week could be a game-changer as he was known for favoring a Brexit without a deal. Both sides' economies are exhausted from lockdowns and coronavirus rising numbers therefore a no-deal scenario is still a possibility but remains unlikely. 

GBP/USD Daily Price Chart (September 29 – November 16, 2020)

Chart source, Webtrader, Capex.com

On November 11, GBP/USD hit an over two-month high at 1.3312 then retreated as bulls seemed to cutback. On Friday, the price rallied to the current trading zone 1.3185 – 1.3460 indicating that the bullish momentum was still intact.

A daily close below the low end of the zone at 1.3185 signals a weaker bullish sentiment. As such, bears may press towards the weekly support level at 1.2916.

On the flip side, a daily close above the low end of the zone at 1.3185 keeps the door open to a further rally towards the high end of the zone 1.3460.

GBP/USD Four Hour Price Chart (November 3 – November 16, 2020)

Chart source, Webtrader, Capex.com

On Friday, GBP/USD rebounded from the bullish trend line originated from November 4 at 1.2913 indicating that bulls were still in charge.

To conclude, while the bullish bias is still in place, a break above 1.3312 may cause a rally towards 1.3433, on the other hand, a break below the aforementioned bullish trend line may correct the price lower and a break below 1.3159 could send the price towards 1.3058. As such, the support and resistance levels underscored on the chart should be monitored closely.

This information/research prepared by Miguel A. Rodriguez does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. The research analyst primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views and consequently any person acting on it does so entirely at their own risk.The research provided does not constitute the views of KW Investments Ltd nor is it an invitation to invest with KW Investments Ltd. The research analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report.The research analyst in not employed by KW Investments Ltd. You are encouraged to seek advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit that conforms to your specific investment objectives, financial situation, or particular financial needs before making a commitment to invest. The laws of the Republic of Seychelles shall govern any claim relating to or arising from the contents of the information/ research provided. 

Share this article

How did you find this article?

Awful
Ok
Great
Awesome

Read More

Miguel A. Rodriguez
Miguel A. Rodriguez
Financial Writer

Miguel worked for major financial institutions such as Banco Santander, and Banco Central-Hispano. He is a published author of currency trading books.