GBP/USD Daily Forecast – British Pound Pulls Back

GBP/USD Video 25.11.20.

U.S. Dollar Attempts To Rebound Against British Pound

GBP/USD lost upside momentum and pulled back below 1.3350 while the U.S. dollar continued to lose ground against a broad basket of currencies.

The U.S. Dollar Index is testing the major support level at 92.10. It has already made several attempts to settle below this level in recent trading sessions but failed to develop sufficient downside momentum.

However, the American currency remains under serious pressure on the foreign exchange market, and the U.S. Dollar Index has a good chance to move below this important support level.

If the U.S. Dollar Index declines below 92.10, it will gain downside momentum and head towards the next support at the yearly lows at 91.75 which will be bullish for GBP/USD.

Traders will continue to follow Brexit news although the talks between UK and EU were postponed after a member of EU team tested positive for COVID-19. The market believes that EU and UK will ultimately sign a deal, and this optimism provided material support to the British pound in recent trading sessions.

Technical Analysis

GBP/USD managed to get above the nearest support level at 1.3325 but failed to settle above 1.3350.

The nearest resistance level for GBP/USD is located at the recent highs at 1.3400, although GBP/USD may also face some resistance at the high of the previous trading day at 1.3380.

If GBP/USD gets above the resistance at 1.3400, it will move towards the next resistance at September highs at 1.3485. There are no material levels between 1.3400 and 1.3485 so this move may be fast. If GBP/USD manages to settle above the resistance at 1.3485, it will gain additional upside momentum and move above 1.3500.

On the support side, the nearest support level for GBP/USD is located at 1.3325. If GBP/USD declines below this level, it will head towards the next support at 1.3270. A move below this support level will open the way to the test of the support at the 20 EMA at 1.3225.

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