GBP/USD Daily Forecast – Test Of Support At 1.3375

U.S. Dollar Tries To Gain More Ground Against British Pound

GBP/USD is currently trying to settle below the support at 1.3375 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index managed to settle above the resistance at 95 and is testing the next resistance level at 95.20. In case this test is successful, the U.S. Dollar Index will move towards the resistance at 95.40 which will be bearish 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 Consumer Sentiment report from U.S.

Analysts expect that Consumer Sentiment improved from 71.7 in October to 72.4 in November. This report may have a significant impact on the dynamics of the U.S. dollar as it will show whether consumers have reacted to the high inflation.

Traders will also keep an eye on the developments in U.S. government bond markets. Treasury yields have pulled back from recent highs, but the upside trend remains strong, and further increase in yields may provide additional support to the American currency.

Technical Analysis

GBP/USD managed to settle below the support level at 1.3400 and is testing the next support at 1.3375.

In case GBP/USD declines below the support at 1.3375, it will move towards the next support at 1.3350. A successful test of this support level will open the way to the test of the support at 1.3310. If GBP/USD settles below 1.3310, it will head towards the next support which is located at 1.3285.

On the upside, the previous support at 1.3400 will serve as the first significant resistance level for GBP/USD. In case GBP/USD manages to settle above this level, it will head towards the next resistance at 1.3425. A successful test of the resistance at 1.3425 will open the way to the test of the next resistance at 1.3450.

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