GBP/USD Forecast: Bullish potential firmly anchored
GBP/USD Current price: 1.3851
- The UK Q4 Gross Domestic Product was slightly better than anticipated.
- UK PM Boris Johnson is confident he could ease lockdown measures soon.
- GBP/USD is technically bullish near a multi-year high and poised to extend its advance.
The GBP/USD pair closed Friday at 1.3851, a few pips below a multi-year high of 1.3865, on the back of the broad dollar’s weakness and mostly encouraging UK macroeconomic data. The UK published the preliminary estimate of its Q4 Gross Domestic Product, which came in at 1.0%, better than the 0.5% expected. The annual figure printed at -7.8%, improving from -8.7% in the previous country. Industrial Production was up 0.2% MoM in December, missing expectations, although the annual figure came in at -3.3%, better than the -3.8% forecast.
During the weekend, British Prime Minister Boris Johnson said he believes he could announce the easing of some lockdown measures soon as the government nears its target of offering vaccines to 15 million people in priority groups. So far, more than 14 million people have received at least one dose of a coronavirus vaccine. Still, the country is dealing with the highly contagious local strain. The daily number of new contagions continue to recede, as well as hospitalizations, although the death toll is still high.
GBP/USD short-term technical outlook
The GBP/USD pair is bullish, and technical readings in the daily chart indicate that the rally could continue. The pair keeps developing above bullish moving averages, with the 20 SMA currently around 1.3715. Technical indicators advance within positive levels, still far from overbought readings. In the near-term, and according to the 4-hour chart, the pair is also developing above all of its moving averages, although the Momentum indicator diverges from price action, stuck around its 100 level, while the RSI indicator is stable at 63. Further gains are likely should the pair accelerate through 1.3865, the immediate resistance level.
Support levels: 1.3800 1.3760 1.3715
Resistance levels: 1.3865 1.3910 1.3960
Premium
You have reached your limit of 3 free articles for this month.
Start your subscription and get access to all our original articles.
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.
