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GBP/USD Daily Forecast – U.S. Dollar Tries To Gain More Ground Against British Pound

By:
Vladimir Zernov
Published: Aug 10, 2021, 06:45 UTC

GBP/USD declined below the 20 EMA and is testing the support level at 1.3835.

GBP/USD

In this article:

Fed Officials Provided Additional Support To U.S. Dollar

GBP/USD is currently trying to settle below the support at 1.3835 while the U.S. dollar is flat against a broad basket of currencies.

The U.S. Dollar Index is trying to get above the 93 level. In case the U.S. Dollar Index manages to get above 93, it will head towards the resistance at 93.10 which will be bearish for GBP/USD.

Yesterday, Fed officials Raphael Bostic and Tom Barkin indicated that tapering was near, providing additional support to the U.S. dollar. At this point, it looks that Fed will reduce its asset purchase program in the fourth quarter of this year, assuming that that the labor market remains healthy.

Meanwhile, foreign exchange market traders will continue to monitor the developments in U.S. government bond markets. The yield of 10-year Treasuries made an attempt to settle above 1.33% but faced resistance and pulled back. A move above the 1.33% level will open the way to the test of the 50 EMA at 1.36% which will be bullish for the U.S. dollar.

Technical Analysis

gbp usd august 10 2021

GBP/USD managed to settle below the 20 EMA at 1.3860 and is trying to settle below the next support level which is located at 1.3835. In case GBP/USD manages to settle below this level, it will head towards the support at 1.3800.

A successful test of the support at 1.3800 will open the way to the test of the next support at 1.3780. In case GBP/USD gets below the support level at 1.3780, it will continue its downside move and head towards the support at 1.3745.

On the upside, the previous support level at the 20 EMA at 1.3860 will serve as the first resistance level for GBP/USD. In case GBP/USD manages to settle back above this level, it will head towards the resistance at the 50 EMA at 1.3880. If GBP/USD settles above the 50 EMA, it will head towards the resistance level which is located at 1.3900.

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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