GBP/USD Daily Forecast – Test Of Important Support Level At 1.3865

British Pound Is Losing Ground Against U.S. Dollar

GBP/USD is currently trying to settle below the support at 1.3865 while the U.S. dollar is gaining some ground against a broad basket of currencies.

The U.S. Dollar Index is moving towards the resistance level at 92. In case the U.S. Dollar Index manages to settle above this level, it will head towards 92.15 which will be bearish for GBP/USD.

UK has recently reported that Nationwide Housing Prices increased by 0.7% month-over-month in June, in line with the analyst consensus. On a year-over-year basis, Nationwide Housing Prices grew by 13.4% compared to analyst consensus which called for growth of 13.7%.

Today, foreign exchange market traders will also have a chance to take a look at housing market data from U.S. Analysts expect that Case-Shiller Home Price Index increased by 1.9% month-over-month in April. On a year-over-year basis, Case-Shiller Home Price Index is projected to grow by 14.5%.

Technical Analysis

GBP/USD managed to settle below the support at 1.3900 and is currently testing the next support level at 1.3865. RSI remains in the moderate territory, and there is plenty of room to gain additional downside momentum in case the right catalysts emerge.

If GBP/USD manages to settle below 1.3865, it will head towards the next support at 1.3835. A successful test of this level will push GBP/USD towards the support at 1.3800. In case GBP/USD declines below 1.3800, it will move towards the next support at 1.3780.

On the upside, the previous support level at 1.3900 will serve as the first resistance level for GBP/USD. In case GBP/USD gets above this level, it will move towards the next resistance at 1.3920. A successful test of this resistance level will open the way to the test of the resistance at 1.3950.

From a big picture point of view, GBP/USD will have a good chance to continue its downside move in case it manages to settle below the support at 1.3865.

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