GBP/USD Forecast: Pound Sterling holds above key support despite weak UK data
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get all exclusive analysis, access our analysis and get Gold and signals alerts
Elevate your trading Journey.
UPGRADE- GBP/USD has been moving sideways above 1.2100 following Wednesday's decline.
- The UK economy grew at a softer pace than expected in Q3.
- Technical picture suggests that buyers remain on the sidelines.
GBP/USD has managed to stage a rebound early Thursday before going into a consolidation phase slightly above 1.2100. The pair's technical outlook shows that buyers remain uninterested and the US Dollar's market valuation is likely to drive the action in the second half of the day.
Earlier in the day, the data published by the UK's Office for National Statistics (ONS) revealed that the Gross Domestic Product (GDP) contracted by 0.3% on a quarterly basis in the third quarter. At an annualized rate, the UK economy grew by 1.9% in Q3, missing the market expectation of 2.4% by a wide margin. These figures weighed modestly on the Pound Sterling but GBP/USD didn't have a hard time holding above 1.2100.
The US economic docket will feature the third-quarter GDP. Since this data will be a revision and is expected to match the previous estimate of 2.9%, it is unlikely to trigger a significant market reaction.
The US Department of Labor will publish the weekly Initial Jobless Claims data as well but the trading action should remain subdued ahead of the Christmas holiday.
Market participants will keep a close eye on US stocks in the American session. Wall Street's three main indexes gained more than 1% on Wednesday and the US Dollar could come under selling pressure if the risk rally picks up steam later in the day.
GBP/USD Technical Analysis
GBP/USD trades slightly below the 20-period Simple Moving Average (SMA) on the four-hour chart and the Relative Strength Index (RSI) indicator stays below 50, suggesting that sellers remain in control of the pair's action.
On the downside, sellers could take action and open the door for an extended slide toward 1.2040 (200-period SMA) and 1.2000 (psychological level) in case 1.2100 (Fibonacci 23.6% retracement of the latest uptrend) is confirmed as resistance.
1.2150 (20-period SMA) aligns as initial resistance before 1.2200 (100-period SMA, 50-period SMA) and 1.2300 (psychological level, static level).
- GBP/USD has been moving sideways above 1.2100 following Wednesday's decline.
- The UK economy grew at a softer pace than expected in Q3.
- Technical picture suggests that buyers remain on the sidelines.
GBP/USD has managed to stage a rebound early Thursday before going into a consolidation phase slightly above 1.2100. The pair's technical outlook shows that buyers remain uninterested and the US Dollar's market valuation is likely to drive the action in the second half of the day.
Earlier in the day, the data published by the UK's Office for National Statistics (ONS) revealed that the Gross Domestic Product (GDP) contracted by 0.3% on a quarterly basis in the third quarter. At an annualized rate, the UK economy grew by 1.9% in Q3, missing the market expectation of 2.4% by a wide margin. These figures weighed modestly on the Pound Sterling but GBP/USD didn't have a hard time holding above 1.2100.
The US economic docket will feature the third-quarter GDP. Since this data will be a revision and is expected to match the previous estimate of 2.9%, it is unlikely to trigger a significant market reaction.
The US Department of Labor will publish the weekly Initial Jobless Claims data as well but the trading action should remain subdued ahead of the Christmas holiday.
Market participants will keep a close eye on US stocks in the American session. Wall Street's three main indexes gained more than 1% on Wednesday and the US Dollar could come under selling pressure if the risk rally picks up steam later in the day.
GBP/USD Technical Analysis
GBP/USD trades slightly below the 20-period Simple Moving Average (SMA) on the four-hour chart and the Relative Strength Index (RSI) indicator stays below 50, suggesting that sellers remain in control of the pair's action.
On the downside, sellers could take action and open the door for an extended slide toward 1.2040 (200-period SMA) and 1.2000 (psychological level) in case 1.2100 (Fibonacci 23.6% retracement of the latest uptrend) is confirmed as resistance.
1.2150 (20-period SMA) aligns as initial resistance before 1.2200 (100-period SMA, 50-period SMA) and 1.2300 (psychological level, static level).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.