GBP/USD Daily Forecast – British Pound Set To Remain Volatile

GBP/USD Video 15.12.20.

British Pound Gains Some Ground Against U.S. Dollar

GBP/USD continues to trade near the 20 EMA at 1.3325 while the U.S. dollar is mostly flat against a broad basket of currencies.

The U.S. Dollar Index remains stuck in the range between the support at 90.50 and the resistance at 91. Yesterday, the U.S. Dollar Index made an attempt to settle below the support at 90.50 but this attempt yielded no results. In case the U.S. Dollar Index gets below 90.50, it will head towards the 90 level which will be bullish for GBP/USD.

Today, foreign exchange market traders will focus on economic data from the UK. Unemployment Rate is projected to grow from 4.8% in September to 5.1% in October due to the negative impact of the second wave of the virus.

Meanwhile, the Claimant Count Change report is projected to show that the number of people claiming for unemployment benefits increased by 30,000 in November.

Traders will also continue to follow Brexit updates. At this point, it is not clear whether UK and EU made any progress in negotiations so the British pound will likely remain volatile.

Technical Analysis

GBP/USD is currently trying to settle above the 20 EMA at 1.3325. If this attempt is successful, GBP/USD will head towards the next resistance level at 1.3400. A move above this level will push GBP/USD towards the resistance at 1.3440.

Yesterday, GBP/USD tested the resistance at 1.3440 but failed to gain additional upside momentum and pulled back below 1.3400. At this point, it looks like GBP/USD will need additional catalysts to get above 1.3440. If GBP/USD settles above this level, it will head towards the next resistance level at 1.3485.

On the support side, the 20 EMA will likely serve as the first support level for GBP/USD. A move below the 20 EMA will push GBP/USD towards the next support at 1.3300.

In case GBP/USD moves below the support at 1.3300, it will decline towards the support at 1.3270. A successful test of the support at 1.3270 will push GBP/USD towards the next support at the 50 EMA at 1.3230.

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