GBP/USD Forecast: Remains above 1.3800, for now

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.3803

The positive tone of the pound faded during the American session.
US dollar outperforms on June’s last trading session.
GBP/USD holds bearish bias, survives above 1.3800.

The GBP/USD pair dropped on Wednesday toward the June low. The decline found support around 1.3800. The pound outperformed on European hours, with cable hitting a daily high at 1.3872 before turning to the downside. The strength of the dollar was enough to push GBP/USD to the downside.

The pound received help from Bank of England’s Haldane comments. He reiterated QE should be reduced considering the economy and central bank’s balance sheet. Haldane is leaving his position. His replacement and the comments from other BoE officials could trigger volatility in the pound’s crosses. UK Q1 GDP data was revised lower from -1.5% to -1.6%. In the US, private payrolls rose by 692K, in line with Friday’s NFP expectations. On Thursday, jobless claims and manufacturing data is due in the US.

GBP/USD short-term technical outlook

The GBP/USD trades around 1.3830, rebounding from the 1.3800 area. The chart shows the bearish bias still intact, although RSI is rebounding from 30. The correction from 1.3796 has more room to run; it is expected to find resistance at 1.3860 (short-term downtrend line). A decline back under 1.3800 should lead to a test of last week’s low at 1.3780; if broken, a steeper decline seems likely.

Support levels: 1.3785 1.3730 1.3665

Resistance levels: 1.3835 1.3875 1.3935

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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