GBP/USD Stable Above 1.3250, Dollar Weakens Further

Key Highlights

  • GBP/USD climbed above 1.3300, but it is still well below the 1.3500 resistance.
  • EUR/USD remained well bid above the 1.2100 zone.
  • AUD/USD and NZD/USD extended gains and traded to a new multi-month high.
  • The UK Claimant Count is likely to change 50K in Nov 2020.

 

GBP/USD Technical Analysis

This week, the British Pound opened with a gap up above 1.3350 against the US Dollar. GBP/USD even broke the 1.3400 resistance, but it failed to continue higher above 1.3450.

Looking at the 4-hours chart, the pair traded as high as 1.3446, and settled well above the 200 simple moving average (green, 4-hours). It seems like there is a connecting bearish trend line forming with resistance at 1.3425.

If there is a clear break above the trend line and 1.3450, the pair could climb above the 1.3500 resistance level in the near term. The next key resistance is near 1.3540, followed by 1.3580.

Conversely, the pair could correct lower below the 1.3320 support. There is a major support forming near the 1.3260 level (a multi-touch zone). If there is a clear break below the 1.3260 and 1.3250 support levels, there is a risk of a sharp decline.

Looking at EUR/USD, the pair remained in a positive zone above the 1.2100 level. More importantly, AUD/USD and NZD/USD continue to outperform, resulting in an increase in pressure on the greenback.

Upcoming Economic Releases

  • UK Claimant Count Change Nov 2020 – Forecast 50K, versus -29.8K previous.
  • UK ILO Unemployment Rate Oct 2020 (3M) – Forecast 5.1%, versus 4.8% previous.
  • US Industrial Production Nov 2020 (MoM) – Forecast 0.3%, versus 1.1% previous.