GBP/USD Daily Forecast – Support At 1.3710 In Sight

British Pound Pulls Back Against U.S. Dollar

GBP/USD is currently trying to get back below the support level at 1.3710 while the U.S. dollar is moving higher against a broad basket of currencies.

The U.S. Dollar Index received support near the 20 EMA at 92.85 and is testing the 93 level. A move above this level will open the way to the test of the resistance at 93.10 which will be bearish for GBP/USD.

Today, foreign exchange market traders will have a chance to take a look at Durable Goods Orders report from U.S. The report is projected to indicate that Durable Goods Orders declined by 0.3% month-over-month in July after growing by 0.8% in June.

Traders will also monitor the developments in U.S. government bond markets ahead of the Jackson Hole Symposium which may have a material impact on currency dynamics.

The yield of 10-year Treasuries has recently managed to get above the 20 EMA at 1.28% and made an attempt to settle above the 1.30% level. If the yield of 10-year Treasuries manages to settle above this level, it will gain additional upside momentum and head towards the 50 EMA at 1.3350% which may provide more support to U.S. dollar.

Technical Analysis

GBP/USD did not manage to settle above the resistance at 1.3745 and pulled back towards the support level at 1.3710. In case GBP/USD declines below this level, it will move towards the next support which is located at 1.3690.

A successful test of the support at 1.3690 will open the way to the test of the support at 1.3665. If GBP/USD declines below this support level, it will head towards the next support at 1.3635.

On the upside, GBP/USD needs to settle above the resistance at 1.3745 to continue its rebound. The next resistance level is located at the 20 EMA at 1.3765. A move above the 20 EMA will push GBP/USD towards the resistance at 1.3780. In case GBP/USD manages to settle above this level, it will head towards the resistance at 1.3800.

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