GBP/USD Daily Forecast – British Pound Is Under Some Pressure Against U.S. Dollar

U.S. Dollar Gains Ground Against British Pound

GBP/USD is currently trying to settle back below the support at 1.3835 while the U.S. dollar is gaining some ground against a broad basket of currencies.

The U.S. Dollar Index managed to settle above 92.15 and is moving towards the resistance at 92.30. A move above this level will open the way to the test of the significant resistance level at the 50 EMA at 92.40 which will be bearish for GBP/USD.

UK has recently released Halifax House Price Index report for August which indicated that house prices increased by 0.7% month-over-month compared to analyst consensus which called for growth of 1.1%. On a year-over-year basis, house prices grew by 7.1%.

Foreign exchange market traders will also keep an eye on the developments in U.S. government bond markets. The yield of 10-year Treasuries has recently managed to settle above the 50 EMA at 1.33% and is moving towards recent highs at 1.375%. In case the yield of 10-year Treasuries gets to the test of this level, U.S. dollar may get more support.

Technical Analysis

GBP/USD managed to get below the support level at 1.3835 and is moving towards the next support which is located at the 50 EMA at 1.3815. In case GBP/USD settles below the 50 EMA, it will gain additional downside momentum and move towards the support level which is located near the 20 EMA at 1.3800.

A successful test of the support at the 20 EMA will open the way to the test of the next support at 1.3780. If GBP/USD declines below this level, it will head towards the support at 1.3745.

On the upside, a move above 1.3835 will push GBP/USD towards the resistance level which has recently emerged at 1.3860. If GBP/USD gets above this level, it will head towards the resistance at 1.3880. A successful test of this level will open the way to the test of the resistance at 1.3900.

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