GBP/USD Daily Forecast – Test Of Resistance At 1.3575

GBP/USD Video 28.12.20.

British Pound Moves Higher Against U.S. Dollar At The Beginning Of The Week

GBP/USD is testing the resistance at 1.3575 while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index is currently moving towards the nearest support level at 90. If the U.S. Dollar Index manages to settle below this support level, it will gain additional downside momentum and head towards the next support at 89.75 which will be bullish for GBP/USD.

There are no important economic reports scheduled to be released today in the U.S. and UK, so foreign exchange market traders will focus on the latest developments on the U.S. stimulus front.

On Sunday, U.S. President Donald Trump signed coronavirus aid and spending bill, averting the shutdown of the government and providing additional stimulus to the economy.

Previously, Trump tried to increase the amount in stimulus checks from $600 to $2,000 per person. It remains to be seen whether he will continue to push for this change.

Technical Analysis

GBP/USD is currently trying to settle above the nearest resistance level at 1.3575. RSI is in the moderate territory so there is plenty of room to gain additional momentum in case the right catalysts emerge.

If this attempt is successful, GBP/USD will move towards the next resistance level which is located at December highs at 1.3625. This resistance level has already been tested several times and proved its strength.

The resistance at 1.3625 has the potential to become a major obstacle on the way up for GBP/USD, but a successful test of this level will signal that GBP/USD is ready for another significant upside move. In this case, GBP/USD will head towards the next resistance at 1.3700.

On the support side, the nearest support for GBP/USD is located at 1.3540. If GBP/USD declines below this level, it will head towards the next support at 1.3500. A move below 1.3500 will push GBP/USD towards the next support level at 1.3485. In case GBP/USD gets below the support at 1.3485, it will move towards the support at the 20 EMA at 1.3445.

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