GBP/USD Daily Forecast – Test Of Resistance At 1.3575

British Pound Moves Higher Against U.S. Dollar

GBP/USD is currently trying to settle above the resistance at 1.3575 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index managed to get below the 94 level and is moving towards the next support level at 93.75. In case the U.S. Dollar Index gets to the test of the support at 93.75, GBP/USD will move higher.

Today, foreign exchange market traders will focus on Producer Prices data from U.S. Analysts expct that Producer Prices increased by 0.6% month-over-month in October after growing by 0.5% in September. On a year-over-year basis, Producer Prices are projected to grow by 8.7%. Core Producer Prices are expected to increase by 6.8% year-over-year.

Traders will also continue to monitor the developments in U.S. government bond markets. The yield of 10-year Treasuries faced significant resistance near the 50 EMA at 1.50% and made an attempt to settle below the support at 1.46%. If the yield of 10-year Treasuries declines below this level, it will move towards the next support at the recent lows near 1.44% which will be bearish for the American currency.

Technical Analysis

GBP/USD is currently testing the resistance level at 1.3575. In case this test is successful, GBP/USD will move towards the next resistance at 1.3600.

A move above 1.3600 will open the way to the test of the resistance level which is located at the 20 EMA at 1.3635. In case GBP/USD manages to settle above the 20 EMA, it will continue its rebound and head towards the next resistance at 1.3665.

On the support side, the previous resistance level at 1.3535 will serve as the first support level for GBP/USD. If GBP/USD declines below the support at 1.3535, it will move towards the next support level which is located at 1.3500. A successful test of this support level will open the way to the test of the next support at 1.3470.

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