British Pound Gains Ground Against U.S. Dollar

GBP/USD is currently trying to settle back above 1.3900 while the U.S. dollar is mostly flat against a broad basket of currencies.

The U.S. Dollar Index continues its attempts to settle above the resistance at 91.80. In case the U.S. Dollar Index manages to settle above this level, it will move towards the next resistance at 92 which will be bearish for GBP/USD.

There are no important economic reports scheduled to be released today so foreign exchange market traders will focus on general market sentiment and the dynamics of U.S. government bond markets.

The yield of 10-year Treasuries has recently managed to settle above 1.50% and made several attempts to settle above the resistance at the 50 EMA at 1.54%. In case the yield of 10-year Treasuries settles above this level, it will gain additional upside momentum which will be bullish for the U.S. dollar.

Technical Analysis

GBP/USD is testing the resistance 1.3900. In case this test is successful, it will get to the test of the next resistance level which is located at 1.3920. RSI is in the moderate territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

If GBP/USD settles above 1.3920, it will move towards the next resistance at 1.3950. A successful test of this level will push GBP/USD towards the resistance which is located at the 20 EMA at 1.3980. If GBP/USD manages to get above the 20 EMA at 1.3980, it will continue its upside move and head towards the next resistance near the 50 EMA at 1.4000.

On the support side, a move below 1.3900 will open the way to the test of the support at 1.3865. If GBP/USD declines below this level, it will head towards the next support at 1.3835. A successful test of the support at 1.3835 will push GBP/USD towards the next support level which is located near the recent lows at 1.3800.

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

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This article was originally posted on FX Empire


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