GBP/USD Daily Forecast – Resistance At 1.3950 Stays Strong

GBP/USD Video 04.03.21.

British Pound Tries To Gain Ground Against U.S. Dollar

GBP/USD continues its attempts to settle above the resistance at 1.3950 while the U.S. dollar is gaining some ground against a broad basket of currencies.

The U.S. Dollar Index is currently trying to settle above the 91 level. If this attempt is successful, the U.S. Dollar Index will head towards the next resistance level which is located at 91.10. A move above this level will open the way to the test of the resistance at 91.30 which will be bearish for GBP/USD.

Yesterday, the U.S. released ADP Employment Change report which indicated that private businesses hired 117,000 workers in February compared to analyst consensus of 177,000.

Today, foreign exchange market traders will have a chance to take a look at another set of U.S. employment data. Initial Jobless Claims report is projected to show that 750,000 Americans filed for unemployment benefits in a week. Meanwhile, Continuing Jobless Claims are expected to decline from 4.42 million to 4.3 million.

Technical Analysis

GBP/USD is currently testing the nearest resistance level at 1.3950. GBP/USD managed to get above this level during yesterday’s trading session but faced significant resistance near 1.4000 and pulled back below 1.3950.

If GBP/USD settles above 1.3950, it will head towards the next resistance level at 1.3980. A move above this level will push GBP/USD towards the resistance at 1.4000. In case GBP/USD gets above the resistance at 1.4000, it will gain additional upside momentum and head towards the resistance at 1.4030.

On the support side, the nearest support level for GBP/USD is located at the 20 EMA at 1.3930. A move below this level will push GBP/USD towards the support at 1.3900. If GBP/USD declines below 1.3900, it will head towards the next support level which is located at 1.3865.

I’d note that GBP/USD continues to stabilize in a wide trading range between the support at 1.3900 and the resistance at 1.4000 and has a good chance to continue its upside trend once it manages to get above 1.4000.

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