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GBP/USD Daily Forecast – Test Of Support At 1.3865

By:
Vladimir Zernov
Published: Mar 16, 2021, 06:41 UTC

GBP/USD settled below the 20 EMA and is testing the next support level at 1.3865.

GBP/USD

In this article:

GBP/USD Video 16.03.21.

British Pound Remains Under Pressure Against U.S. Dollar

GBP/USD is currently trying to settle below the support at 1.3865 while the U.S. dollar is mostly flat against a broad basket of currencies.

The U.S. Dollar Index is currently stuck in the range between the support at 91.75 and the resistance at 92. If the U.S. Dollar Index continues its rebound and manages to settle above the 92 level, GBP/USD will find itself under more pressure.

Today, foreign exchange market traders will focus on economic data from the U.S. Analysts expect that Retail Sales decreased by 0.5% month-over-month in February after growing by 5.3% in January.

It remains to be seen whether this report will have a material impact on the market as traders are mostly interested in the consequences of the new stimulus package which will not be seen in February data.

The U.S. will also release Industrial Production and Manufacturing Production reports. Industrial Production is projected to increase by 0.3% month-over-month in February while Manufacturing Production is expected to decline by 0.1%.

Technical Analysis

gbp usd march 16 2021

GBP/USD is currently testing the nearest support level at 1.3865. If this test is successful, GBP/USD will move towards the next support which is located at 1.3835. RSI remains in the moderate territory, and there is plenty of room to gain additional momentum in case the right catalysts emerge.

If GBP/USD settles below the support at 1.3835, it will get to the test of the next support level at the 50 EMA at 1.3825. A move below the 50 EMA will push GBP/USD towards the support at 1.3800.

On the upside, GBP/USD needs to stay above the support at 1.3865 to have a chance to gain upside momentum in the near term. The nearest resistance level for GBP/USD is located at the 20 EMA at 1.3910.

In case GBP/USD gets above the 20 EMA, it will head towards the next resistance level at 1.3950. A move above the resistance at 1.3950 will push GBP/USD towards the next resistance at 1.3980. If GBP/USD settles above this level, it will head towards the resistance at 1.4000.

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

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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