British Pound Is Under Pressure
GBP/USD is currently trying to settle below the support at 1.3690 while the U.S. dollar is gaining ground against a broad basket of currencies.
The U.S. Dollar Index managed to settle above the resistance at 93.10 and is moving towards the next resistance level which is located at 93.40. In case the U.S. Dollar Index gets to the test of this level, GBP/USD will find itself under more pressure.
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 continue to wait for the Fed Interest Rate Decision which will be released on September 22.
Traders will also keep an eye on the developments in China as Evergrande’s problems have already put pressure on markets. The U.S. dollar may benefit from rush to safety due to its safe-haven status.
GBP/USD managed to get below the support at 1.3710 and is trying to settle below the next support level at 1.3690. RSI remains in the moderate territory, and there is plenty of room to gain additional downside momentum in case the right catalysts emerge.
In case GBP/USD declines below the support at 1.3690, it will head towards the next support level at 1.3665. A successful test of this level will open the way to the test of the next support at 1.3635. If GBP/USD gets below 1.3635, it will continue its downside move and head towards the next support at 1.3600.
On the upside, the previous support level at 1.3710 will serve as the first resistance level for GBP/USD. A move above this level will push GBP/USD towards the next resistance at 1.3745. In case GBP/USD gets above 1.3745, it will head towards the resistance level near the 20 EMA at 1.3780. A successful test of this level will open the way to the test of the next resistance which is located near the 50 EMA at 1.3800.
For a look at all of today’s economic events, check out our economic calendar.