GBP/USD Daily Forecast – Test Of Major Resistance At 1.4000

GBP/USD Video 20.04.21.

British Pound Continues To Move Higher Against U.S. Dollar

GBP/USD is currently trying to settle above the resistance at 1.4000 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is currently trying to settle below the support at the 91 level. In case this attempt is successful, the U.S. Dollar Index will head towards the next support at 90.70 which will be bullish for GBP/USD.

Today, UK reported that Unemployment Rate declined from 5% in January to 4.9% in February compared to analyst consensus of 5.1%. Claimant Count Change report indicated that the number of people claiming unemployment benefits increased by 10,100 in March. Analysts projected that it would increase by 150,000 so the report was much better than expected.

Positive economic data may provide additional support to the British pound which gained strong upside momentum in recent trading sessions. Tomorrow, foreign exchange market traders will have a chance to take a look at inflation data from the UK. Inflation Rate is projected to grow by 0.8% year-over-year in March while Core Inflation Rate is expected to increase by 1.1%. There are no signs of pricing pressure in the UK, but stronger-than-expected inflation may provide more support to GBP/USD.

Technical Analysis

GBP/USD managed to get above the resistance at 1.3980 and is testing the major resistance level at 1.4000. Back in March, GBP/USD made several attempts to settle above this level but failed to develop sufficient upside momentum.

In case GBP/USD settles above 1.4000, it will move towards the next resistance level at 1.4020. A successful test of this level will open the way to the test of the next resistance at 1.4050. If GBP/USD gets above this level, it will head towards the resistance at 1.4080.

On the support side, the previous resistance at 1.3980 will serve as the first support level for GBP/USD. If GBP/USD declines below this level, it will head towards the next support at 1.3950. A successful test of the support at 1.3950 will open the way to the test of the support at 1.3920.

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