GBP/USD Daily Forecast – U.S. Dollar Stays Under Pressure

British Pound Gains Some Ground Against U.S. Dollar

GBP/USD is currently trying to settle above the resistance at 1.3780 while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index continues its attempts to settle below the support level at the 50 EMA at 92.45. If the U.S. Dollar Index manages to settle below this support level, it will gain additional downside momentum and head towards the support at 92.30 which will be bullish for GBP/USD.

Yesterday, U.S. released ADP Employment Change report which indicated that private businesses hired 374,000 workers in August compared to analyst consensus of 613,000. The report put pressure on the U.S. dollar as the Fed is focused on providing support to the job market, and disappointing employment reports may delay tapering.

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 345,000 Americans filed for unemployment benefits in a week. Continuing Jobless Claims are projected to decrease from 2.86 million to 2.78 million.

Technical Analysis

GBP/USD continues its attempts to settle above the resistance level at 1.3780. If GBP/USD manages to settle above this level, it will get to another test of the resistance at 1.3800. 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 moves above 1.3800, it will get to the test of the next resistance at the 50 EMA at 1.3810. A successul test of this level will open the way to the test of the resistance at 1.3835.

On the support side, the nearest support level for GBP/USD is located at the 20 EMA at 1.3765. If GBP/USD gets back below the 20 EMA, it will head towards the support at 1.3745. A move below 1.3745 will open the way to the test of the support at 1.3710.

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