GBP/USD Forecast: Sticking to 1.3000 in anticipation of Brexit news

The GBP/USD trades on higher ground and is not going anywhere fast.
A 6-hour meeting between Barnier and Raab is closely watched.
The technical picture remains bullish for the pair.

Yohay Elam FXStreet

The GBP/USD is trading the 1.3000 level as August draws to a close. Cable is holding the high ground it reached after Chief European Union negotiator Michel Barnier said that the EU is ready to offer the UK a "deal like no other country."

Since then, the pair enjoyed some stability despite instability in other markets. Emerging markets have been reeling, with Argentina and Turkey stand out. US President Donald Trump said that he wants tariffs on China to come "as soon as possible," adding to the risk-off environment. The GBP/USD lost some ground but recovered it.

The focus now returns to Brexit. UK Brexit Minister Dominic Raab will meet Barnier in Brussels to "take stock" of the talks. A 6-hour session is scheduled for the two gentlemen and their teams. Any reports coming out of Brussels and a potential press conference will be watched closely by the Pound.

Analysis: GBP/USD: Three reasons to fade the Barnier breakout - selling opportunity?

Steady trading may also be broken by end-of-month flows and as US traders get ready for a long weekend. We could see some choppy movements in the European afternoon.

GBP/USD Technical Analysis

The Relative Strength Index on the four-hour chart is below 70, meaning that the pair is not in oversold conditions. The GBP/USD is also trading above the 50 and 200 Simple Moving Averages, and Momentum is upbeat. All in all, the picture is bullish.

1.3045 is the immediate cap after being the high point in recent days. 1.3080 is the next line to watch after it held the pair down in late July. 1.3175 was a swing line around that time. 1.3220 is next up.

1.2980 provided support to the GBP/USD after the recent surge. 1.2940 capped the pair twice in late August. 1.2840 was the low just before the leap.

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

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