GBP/USD Forecast: battling with 1.3000, short term bullish

Valeria Bednarik FXStreet

The GBP/USD pair struggles with the 1.3000 level, retreating from a high of 1.3030, following comments from Minouche Shafik, BOE's Deputy Governor, saying that more easing is probably needed in the UK, after the Brexit economic shock. There are no news scheduled in the UK for this Wednesday, with attention centered in FED's Yellen testimony before the Committee on Financial Services, in Washington, later today, and US Durable Goods Orders for August.

Stocks in Europe opened with a positive tone, failing however, to trigger demand for the Pound, and paring gains after the initial rally. Overall, the pair is now in a short term consolidative stage, having modestly corrected its latest bearish run. The recovery seen late Tuesday stalled short of the 23.6% retracement of the latest daily decline between 1.3420 and 1.2914 at 1.3040, now the immediate resistance.

The short term technical picture is modestly bullish, as the pair bounced sharply after testing its 20 SMA while technical indicators hold within positive territory, although with no directional strength. The price needs to accelerate above the mentioned Fibonacci resistance to be able to extend its gains up to 1.3100, while the daily low, 1.2980 around the mentioned 20 SMA, is the immediate support with a break below it probably implicating a downward extension towards 1.2920/30.

View live chart of the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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