GBP/USD Daily Forecast – British Pound Gets Some Support After Sell-Off

GBP/USD Video 13.11.20.

British Pound Tries To Move Higher Against U.S. Dollar

GBP/USD found support near 1.3100 and is trying to rebound from yesterday’s sell-off while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index is currently stuck near the 93 level. It has already made several attempts to get above the resistance at the 20 EMA at 93.15 but these attempts yielded no results.

At the same time, the U.S. Dollar Index failed to gain any downside momentum. In case the U.S. Dollar Index manages to settle above the 20 EMA, it will gain upside momentum and move towards the 50 EMA at 93.40 which will be bearish for GBP/USD.

Yesterday, UK reported that its third-quarter GDP grew by 15.5% quarter-over-quarter compared to analyst consensus which called for growth of 15.8%. On a year-over-year basis, GDP declined by 9.6% while analysts expected a decline of 9.4%.

Industrial Production and Manufacturing Production reports were also worse than analyst expectations. Industrial Production grew by 0.5% month-over-month in September compared to analyst consensus of 0.8% while Manufacturing Production increased by 0.2% compared while analysts called for growth of 1%.

The reports indicated that the rebound of the British economy was slowing down before strict anti-virus measures were implemented. The data for October and November will surely look worse, and concerns about the speed of the recovery may put some pressure on the pound.

Technical Analysis

GBP/USD did not manage to settle below the support at 1.3100 and is trying to gain some upside momentum. The nearest resistance level for GBP/USD is located at 1.3140.

If GBP/USD manages to settle above this level, it will head towards the next resistance at 1.3180. A move above 1.3180 will open the way to the test of the resistance at 1.3210.

On the support side, GBP/USD needs to get below 1.3100 to continue its downside move. The 20 EMA is located in the nearby, so GBP/USD will likely get strong support in this area.

In case GBP/USD settles below the support at 1.3100, it will head towards the next support level at 1.3070. A move below this level will push GBP/USD towards the support at the 50 EMA at 1.3025.

For a look at all of today’s economic events, check out our economic calendar.