GBP/USD Forecast: Ignoring discouraging UK news

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3055

The UK CBI Distributive Trade Survey on realized sales plunged to -23 in October.
The kingdom reported over 22K new coronavirus cases, the highest one-day increase on record.
GBP/USD is holding on to gains near the 1.3100 level amid the broad dollar’s weakness.

The GBP/USD pair advanced to 1.3079 a weekly high, trading a handful of pips below the level as the American session came to an end. The dollar came under selling pressure during US trading hours, after a consumer confidence indicator came in worse than anticipated, putting Wall Street under pressure and hence, the greenback. US indexes, however, managed to move away from daily lows, ending the day mixed.

The UK published the Confederation of British Industry Distributive Trades Survey on realized sales, that fell in October to -23 from 11 in the previous month, also below the expected 1. It was the lowest reading since last June. Meanwhile, the UK reported over 22K new coronavirus cases, the highest one-day increase. Despite its resilient behavior the pound may soon give up. Progress in Brexit talks, on the other hand, could boost the pair. This Wednesday, the UK will publish the BRC Shop Price Index for September.

GBP/USD short-term technical outlook

From a technical point of view, the GBP/USD pair is neutral-to-bearish in the near-term. The 4-hour chart shows that the pair got to settle above all of its moving averages, although the Momentum indicator is retreating modestly from near its midline. The RSI indicator, in the meantime, is holding above its midline but losing upward strength. Below 1.2980 the pair will likely be in the hands of bears, who will try to push it sub-1.2900.

Support levels: 1.3035 1.2980 1.2930

Resistance levels: 1.3115 1.3150 1.3200

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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