GBP/USD Daily Forecast – British Pound Moves Higher After Yesterday’s Sell-Off

GBP/USD Video 08.04.21.

British Pound Rebounds Against U.S. Dollar

GBP/USD is currently trying to settle back above 1.3745 while the U.S. dollar is losing some ground against a broad basket of currencies.

The U.S. Dollar Index has recently made an attempt to get to the test of the nearest resistance level at 92.50 but failed to develop sufficient upside momentum and pulled back towards the support at the 20 EMA at 92.35. In case the U.S. Dollar Index manages to settle below the 20 EMA, it will head towards the support at 92.15 which will be bullish for GBP/USD.

Yesterday, UK reported that Services PMI increased from 49.5 in February to 56.3 in March compared to analyst consensus of 56.8. Today, foreign exchange market traders will focus on the job market data from the U.S. Analysts expect that Initial Jobless Claims declined from 719,000 to 680,000 while Continuing Jobless Claims decreased from 3.79 million to 3.65 million. The recent job market reports indicated the the job market was recovering at a robust pace.

Technical Analysis

gbp usd april 8 2020

GBP/USD has recently managed to get back above 1.3745 and is trying to develop additional upside momentum. RSI is in the moderate territory, and there is plenty of room to gain momentum in case the right catalysts emerge.

The next resistance level for GBP/USD is located at 1.3780. If GBP/USD manages to settle above this level, it will head towards the next resistance at 1.3800. A move above the resistance at 1.3800 will push GBP/USD towards the next resistance which is located at the 50 EMA at 1.3820. The 20 EMA is located at the same level, so GBP/USD will likely face strong resistance at 1.3820.

On the support side, the nearest support level for GBP/USD is located at 1.3745. In case GBP/USD manages to settle below this level, it will move towards the next support at 1.3710.

A successful test of the support at 1.3710 will push GBP/USD towards the next support at 1.3665. In case GBP/USD declines below this level, it will head towards the support at 1.3625.

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