GBP/USD Forecast: Sellers cautious despite dollar’s strength

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.3120

UK’s Parliament resumed debate on PM Johnson’s withdrawal bill.
UK macroeconomic calendar to remain scarce this Wednesday.
GBP/USD ends the day in the red, but risk still skewed to the upside.

The GBP/USD pair peaked at 1.3212 this Tuesday, as the Pound surged during London trading hours but ended up giving up to the dollar’s strength. The focus is turning back to Brexit, as the Parliament returned from the Christmas holidays and is preparing to vote on PM Johnson´s withdrawal deal. The market believes that, given Tories’ victory in the latest general election, the exit bill won’t found opposition and would pave the way for the departure this month. Policymakers have started debating the bill, and are set to vote on it next Thursday.

The UK calendar will remain scarce this Wednesday, as the kingdom will only release the Halifax House Prices report.

GBP/USD short-term technical outlook

The GBP/USD pair closed the day in the red but posted a third consecutive higher high and higher low, which limits the downside potential of the pair. It is currently trading just below the 38.2% retracement of its latest daily decline at 1.3150, the immediate resistance. In the 4-hour chart, the price is converging with the 20 and 100 SMA, with the shortest gaining bearish strength. Technical indicators, however, have managed to turn high around their midlines, also indicating the absence of selling interest.

Support levels: 1.3090 1.3050 1.3010

Resistance levels: 1.3150 1.3190 1.3225

View Live Chart for 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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