GBP/USD: The question is whether it is a rally that can be trusted? [Video]
With a weakening dollar, even Cable is rallying. The question is whether it is a rally that can be trusted? This has been an issue we have pondered throughout the past week as a Cable recovery has tentatively developed. Friday’s breakout above resistance at $1.2360 was the next step forward in the move which has formed a shallow uptrend of the past couple of weeks (comes in today at $1.2235). Although momentum indicators are pulling higher, we continue to view this move with caution. Effectively, with MACD lines are only tentatively rising still below neutral, whilst RSI is a shade above 50 this looks to be the moves of a ranging market. Read More…
GBP/USD analysis: Could go downwards
At the end of last week, the GBP/USD exchange rate consolidated in the 1.2325 area. During Monday morning, the rate reached the upper line of the short-term ascending channel at 1.2425.
From a theoretical point of view, it is likely that some downside potential could prevail in the market, as the currency pair could target the lower channel line circa 1.2250. Note that the pair could gain support from the 55– and 100-hour SMAs, as well the weekly and monthly PPs in the 1.2306/1.2346 range. Read More…
GBP/USD Forecast: Bulls now await a move beyond 1.2430-40 confluence hurdle
The GBP/USD pair added to last week’s strong positive move of over 200 pips and continued gaining traction through the early part of trading action on the first day of a new trading week. The pair rallied to three-week tops – levels beyond the 1.2400 mark – and the momentum was sponsored by the prevalent US dollar selling bias. The global risk sentiment remained well supported by the recent optimism over a potential COVID-19 vaccine, the easing of lockdown restriction across the world and growing hopes of a sharp V-shaped recovery for the global economy.
Investors also breathed a sigh of relief after the US President Donald Trump’s response to China’s move to tighten control over Hong Kong. As expected, Trump began the process of ending Hong Kong’s special status but did not withdraw from the US-China phase-one trade deal. Adding to this, signs of a pickup in the Chinese manufacturing sector activity further boosted investors’ confidence and further undermined the greenback’s relative safe-haven status. A broad-based USD weakness, in turn, was seen as one of the key factors driving the GBP/USD pair higher. Read More…
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