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GBP/USD Could Rebound Further Above 1.3200

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Aayush Jindal

Key Highlights

  • The British Pound rebounded nicely and tradedabove 1.3150 against the US Dollar.
  • A major bullish trend line is forming withsupport near 1.3035 on the 4-hours chart of GBP/USD.
  • The Euro Area Retail Sales in March 2019increased 1.9% (YoY), better than the 1.8% forecast.
  • UK’s BRC Like-for-Like Retail Sales in April2019 could increase 2.4% (YoY).

GBPUSD Technical Analysis

This past week, the British Pound formed a strong support near 1.2920 against the US Dollar. As a result, the GBP/USD pair started an upward move and climbed above 1.3000, 1.3040 and 1.3100.

GBPUSD Technical Analysis British Pound US Dollar

Looking at the 4-hours chart, the pair rallied sharply fromthe 1.2986 swing low. It broke the 1.3150 resistance level and settled wellabove the 100 simple moving average (red, 4-hours).

A new monthly high was formed at 1.3177 and recently thepair corrected lower. It broke the 1.3120 level and tested the 50% Fibretracement level of the last wave from the 1.2986 low to 1.3177 high.

On the downside, there are many supports near the 1.3050,1.3040 and 1.3035 levels. There is also a major bullish trend line forming withsupport near 1.3035 on the same chart. Besides, the 76.4% Fib retracement levelof the last wave from the 1.2986 low to 1.3177 high is near the 1.3031 level.

Only a daily close below the 1.3000 support and the 200simple moving average (green, 4-hours) could start a fresh bearish wave in thenear term. Conversely, the pair is likely to bounce back above 1.3140 and1.3150.

On the upside, a clear break above the 1.3177 high mightopen the doors for a test of the 1.3200 resistance level. The next keyresistances are near 1.3220 and 1.3245.

Looking at the other major pairs, EUR/USD is still struggling below the 1.1250 resistance level, and USD/JPY seems to be facing an increase in selling pressure.

Economic Releases to Watch Today

  • UK Halifax House Prices for April 2019 (MoM) -Forecast -2.4%, versus -1.6% previous.
  • US IBD/TIPP Economic Optimism Index May 2019(MoM) - Forecast 54.2, versus 54.5 previous.
  • UK BRC Like-for-Like Retail Sales April 2019(YoY) - Forecast +2.4%, versus 1.1% previous.
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