GBP/USD Forecast: Brexit hopes keep underpinning sterling

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3351

Brexit talks continue without news on progress, optimism persists.
BOE’s Haskel said that policymakers “have plenty” to do in terms of policy firepower.
GBP/USD retains its bullish stance in the near-term, eyes on 1.3410.

The GBP/USD pair has advanced for a third consecutive day as broad optimism, and Brexit hopes continue to underpin the sterling, although it´s ending the day with modest gains. Trade talks between the EU and the UK extended into this week, and while weekend news suggested progress, nothing has been confirmed yet.

BOE’s Jonathan Haskel was on the wires this Tuesday and referred to Brexit and the coronavirus pandemic, indicating that both could affect the central bank’s outlook for 2021. He added that policymakers “have plenty” to do in terms of policy firepower. The UK won’t publish macroeconomic data this Wednesday.

GBP/USD short-term technical outlook

The GBP/USD pair is biased higher, but the bullish momentum is limited by a cautious stance ahead of Brexit clarity. The 4-hour chart shows that the pair has bounced from a bullish 20 SMA, which led the way higher ever since the week started. The larger moving averages are accelerating their advance below the shorter one. Technical indicators remain within positive levels but lack strength enough to confirm an advance coming.

Support levels: 1.3310 1.3265 1.3210

Resistance levels: 1.3365 1.3410 1.3460

View Live Chart for the GBP/USD

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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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