GBP/USD Daily Forecast – Test Of Support At 1.3200

British Pound Is Mostly Flat Against U.S. Dollar

GBP/USD is currently trying to settle below the support at 1.3200 while the U.S. dollar is gaining some ground against a broad basket of currencies.

The U.S. Dollar Index received support near the 20 EMA at 95.85 and rebounded towards the 96 level. In case the U.S. Dollar Index manages to settle above this level, it will move towards the next resistance at 96.25 which will be bearish for GBP/USD.

Today, foreign exchange market traders will focus on Initial Jobless Claims and Continuing Jobless Claims reports from U.S. Analysts expect that Initial Jobless Claims report will show that 215,000 Americans filed for unemployment benefits in a week. Continuing Jobless Claims are expected to decline from 1.96 million to 1.9 million.

Traders will also keep an eye on Treasury yields. The yield of 2-year Treasuries has pulled back from recent highs, but the current upside trend looks strong. In case the yield of 2-year Treasuries manages to settle above 0.71% and move higher, U.S. dollar may get additional support.

Technical Analysis

GBP/USD settled below the support level at 1.3230 and is trying to settle below the next support level at 1.3200. In case this attempt is successful, GBP/USD will move towards the support which is located at the recent lows at 1.3170. RSI is close to the oversold territory, but there is enough room to gain additional downside momentum in case the right catalysts emerge.

A move below the support at 1.3170 will open the way to the test of the support at 1.3140. If GBP/USD declines below this level, it will head towards the support at 1.3110.

On the upside, the previous support at 1.3230 will serve as the first resistance level for GBP/USD. If GBP/USD manages to settle above the resistance at 1.3230, it will head towards the next resistance level at 1.3250. A successful test of the resistance at 1.3250 will push GBP/USD towards the resistance at 1.3280.

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