GBP/USD Forecast: bearish below 1.2690

Valeria Bednarik FXStreet

The GBP/USD pair trades marginally higher daily basis, extending its winning streak earlier today to 1.2759, its highest since last Monday. The pair, however, retreated from the mentioned level on a sudden surge of dollar's demand triggered by a sharp decline in gold prices. The pair holds a handful of pips above its Friday's close, with the Pound underpinned by headlines suggesting that a deal between May's conservatives and the DUP will be announced around London lunchtime. If confirmed, Theresa May will be able to form a government, with the pressure easing partially for her, at least in the inner front. Still, Brexit negotiations are on the table and little the UK can do without the EU approval there.

Technically, the 4 hours chart shows that the price keeps retreating towards a bullish 20 SMA, this last offering an immediate dynamic support around 1.2690, while technical indicators retreat within positive territory, supporting a bearish extension on a break below the mentioned level. Next intraday supports come at 1.2665 and 1.2635, with further slides below this last exposing 1.2588, the low set last week. Above the mentioned daily high, on the other hand, the pair can extend its advance up to 1.2800, although profit taking around this last will likely prevent the pair from advancing further.

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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