GBP/USD Tests Resistance At 1.3075

Key Insights

• GBP/USD continues to rebound as the U.S. Dollar Index declines towards the 100 level. 
• Today, traders will focus on the Initial Jobless Claims report from the U.S. 
• A move above the 20 EMA will push GBP/USD towards the resistance at 1.3110.

British Pound Moves Higher Against U.S. Dollar

GBP/USD is currently trying to settle above the resistance at the 20 EMA at 1.3075, while the U.S. dollar is losing ground against a broad basket of currencies.

The U.S. Dollar Index settled below the support at 100.30 and is trying to get below the next support at the 100 level. In case this attempt is successful, GBP/USD will move towards the support at the 20 EMA at 99.75, which will be bullish for GBP/USD.

Today, foreign exchange market traders will focus on job market reports from the U.S. Initial Jobless Claims report is expected to show that 180,000 Americans filed for unemployment benefits in a week. Continuing Jobless Claims are expected to decline from 1.48 million to 1.46 million.

Traders will also keep an eye on the developments in U.S. government bond markets. Treasury yields have started to rebound after yesterday’s pullback, but it remains to be seen whether this rebound will provide enough support to the American currency.

Technical Analysis

GBP/USD is testing the resistance at 1.3075. In case this test is successful, GBP/USD will move towards the next resistance level, which is located at 1.3110.

A move above the resistance at 1.3110 will open the way to the test of the next resistance at 1.3140. If GBP/USD climbs above this level, it will head towards the resistance at the 50 EMA at 1.3165.

On the support side, the previous resistance at 1.3050 will serve as the first support level for GBP/USD. If GBP/USD manages to settle back below this level, it will head towards the next support level, which is located at 1.3030. A successful test of the support at 1.3030 will open the way to the test of the support at 1.3000.

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