GBP/USD Daily Forecast – Test Of Resistance At 1.3745

British Pound Gains More Ground Against U.S. Dollar

GBP/USD is currently trying to settle above the resistance at 1.3745 while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index is currently trying to settle below the 93 level. In case this attempt is successful, the U.S. Dollar Index will move towards the support at the 20 EMA at 92.85 which will be bullish for GBP/USD.

Yesterday, UK reported that UK Manufacturing PMI declined from 60.4 in July to 60.1 in August compared to analyst consensus of 59.5. UK Services PMI declined from 59.6 to 55.5 due to worries about the spread of the Delta variant of coronavirus.

PMI reports from U.S. looked similar as Manufacturing PMI decreased from 63.4 in July to 61.2 in August while Services PMI declined from 59.9 to 55.2.

Today, foreign exchange market traders will take a look at New Home Sales report from U.S. Analysts expect that New Home Sales increased by 1% month-over-month in July after declining by 6.6% in June.

Technical Analysis

GBP/USD managed to settle above the resistance at 1.3710 and is testing the next resistance at 1.3745. In case this test is successful, GBP/USD will move towards the next resistance level which is located at the 20 EMA at 1.3770. RSI remains in the moderate territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

If GBP/USD settles above the resistance at the 20 EMA at 1.3770, it will get to the test of the next resistance at 1.3780. A move above 1.3780 will open the way to the test of the resistance at 1.3800.

On the support side, the previous resistance level at 1.3710 will serve as the first support level for GBP/USD. In case GBP/USD declines below the support at 1.3710, it will head towards the next support at 1.3690. A successful test of the support at 1.3690 will push GBP/USD towards the next support which is located at 1.3665.

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