GBP/USD Video 28.04.21.
U.S. Dollar Gains Ground Against British Pound
GBP/USD did not manage to settle above the resistance at 1.3900 and remains in the range between the support at 1.3865 and the resistance at 1.3900 while the U.S. dollar is gaining ground against a broad basket of currencies.
The U.S. Dollar Index is currently testing the resistance at the 91 level. This resistance level has already been tested many times in recent trading sessions and proved its strength. In case the U.S. Dollar Index manages to settle above this level, it will gain additional upside momentum and head towards the next resistance at 91.30 which will be bearish for GBP/USD.
Today, foreign exchange market traders will focus on the Fed Interest Rate Decision. The rate is expected to stay unchanged at 0.25%, and the market will focus on Fed’s commentary. The Fed has been consistently dovish and promised to provide support as long as necessary.
It should be noted that Treasury yields have been moving higher in recent trading sessions as traders remain worried about higher inflation. Higher yields provided some support to the U.S. dollar, and the continuation of the current trend will be bearish for GBP/USD.
GBP/USD failed to settle above the resistance at 1.3900 and pulled back. The nearest support level for GBP/USD is located at 1.3865. A move below this level will lead to a test of the support at the 20 EMA at 1.3855.
In case GBP/USD declines below the 20 EMA at 1.3855, it will head towards the next support level which is located at the 50 EMA at 1.3835. A successful test of this level will open the way to the test of the support at 1.3800.
On the upside, GBP/USD needs to settle above the resistance at 1.3900 to continue its upside move. In case GBP/USD manages to settle above this level, it will head towards the resistance at 1.3920. A move above this level will push GBP/USD towards the resistance at 1.3950.
For a look at all of today’s economic events, check out our economic calendar.