GBP/USD Daily Forecast – Test Of Resistance At 1.3425

British Pound Moves Higher Against U.S. Dollar

GBP/USD is currently trying to settle above the resistance at 1.3425 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is testing the support level at 95. In case the U.S. Dollar Index manages to settle below this level, it will move towards the support at 94.75 which will be bullish for GBP/USD.

There are no important economic reports scheduled to be released in the UK today, so foreign exchange market traders will focus on NY Empire State Manufacturing Index from the U.S.

Analysts expect that NY Empire State Manufacturing Index increased from 19.8 in October to 21.6 in November. Typically, this report has little impact on currency dynamics, but it may have a bigger impact today as the market is worried about the impacts of inflation on producers and consumers. A weaker-than-expected report may provide additional support to safe-haven assets.

Technical Analysis

GBP/USD is testing the resistance level at 1.3425. RSI has recently moved away from the oversold territory, and there is plenty of room to gain upside momentum in case the right catalysts emerge.

In case GBP/USD manages to settle above the resistance at 1.3425, it will head towards the next resistance level which is located at 1.3450. A successful test of this resistance level will open the way to the test of the resistance at 1.3470. If GBP/USD climbs above 1.3470, it will continue its rebound and head towards the resistance at 1.3500.

On the support side, GBP/USD needs to get back below 1.3425 to have a chance to develop downside momentum in the near term. The next support level for GBP/USD is located at 1.3400.

In case GBP/USD manages to settle back below the support at 1.3400, it will head towards the next support at 1.3375. A move below 1.3375 will push GBP/USD towards the next support level which is located at 1.3350.

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