GBP/USD Forecast: levels to watch ahead of Fed

Valeria Bednarik FXStreet

The GBP/USD pair trades lower in range, still unable to find a clear direction as the market waits for clear clues from the Fed later on the day. The UK released its preliminary Q2 GDP figures, with the economy estimated to have grew 0.3% in the three months to June, matching market's expectations. Yearly basis, growth was of 1.7%, also matching market's forecast. The Pound eased modestly after the release, as the tepid numbers support the BOE's on-hold stance when it comes to rates.

From a technical point of view, the pair has been holding within Fibonacci levels pretty much since the week started, finding support around 1.3010, the 38.2% retracement of the latest weekly advance, but unable to settle beyond 1.3050, the 23.6% retracement of the same rally. In the 4 hours chart, the pair maintains a neutral stance, with technical indicators flat around their mid-lines and the price stuck around a marginally bullish 20 SMA.

Anyway, an unexpectedly hawkish Fed could push the pair below the 1.3010 level, with the next support then being 1.2965, the 50% retracement of the mentioned rally, en route to the 1.2920 region, where the pair bottomed last week

To the upside, an steady advance beyond 1.3050 on another round of dollar's sell-off triggered by the Fed, could see the pair extending its advance up to 1.3125, the yearly high posted earlier this month.

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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