GBP/USD outlook: Risk appetite lifts the pair to seven-week high

Slobodan Drvenica Windsor Brokers

GBP/USD

GBPUSD bulls held grip at the start of the week and cracked psychological 1.2400 barrier, in attempts to extend Friday’s nearly 1.5% advance.

Fresh risk appetite gave strong boost to sterling, in addition to BOE’s hawkish stance despite keeping rates on hold last week and warning signals from various sectors of the US economy and dovish steer from the central bank in response.

Last week’s advance and close above the ceiling of a multi-week consolidation range generated a signal of formation of a higher base (1.2040/70 zone) and possible stronger recovery.

Bulls eye pivotal barriers at 1.2434/58 (200DMA / Fibo 38.2% of 1.3140/1.2037 downtrend) violation of which to generate stronger reversal signal and open way for extension towards daily cloud top (1.2516) and 100DMA (1.2541).

Bullish daily studies contribute to positive near-term outlook, though overbought conditions warn.

Bullish bias to remain intact while dips stay above broken daily cloud base (1.2347).

Res: 1.2434; 1.2458; 1.2541; 1.2588.
Sup: 1.2347; 1.2337; 1.2297; 1.2242.

Interested in GBP/USD technicals? Check out the key levels

1. R3 1.2656
2. R2 1.2523
3. R1 1.2451
PP 1.2318
1. S1 1.2246
2. S2 1.2113
3. S3 1.2041

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

EUR/USD remains cautious near 1.1760 ahead of US data

EUR/USD trades marginally on the defensive at the end of the week, hovering around the 1.1770-1.1760 band against the backdrop of an equally humble advance in the US Dollar. Meanwhile, investors gear up for the release of key US data later in the day, including PCE and GDP figures.

GBP/USD looks slightly bid near 1.3480, focus on US docket

The British Pound gathers some fresh steam on Friday, prompting GBP/USD to reverse four consecutive days of losses and revisit the 1.3480 zone. Cable’s decent bounce comes on the back of modest gains in the Greenback prior to the release of significant US data.

Gold extends the recovery past $5,000/oz, looks at US data

Gold prices advance for the third straight day on Friday, reaching new multi-day highs just north of the key $5,000 mark per troy ounce. The continuation of the precious metal’s uptick follows steady geopolitical effervescence in the Middle East, while traders eagerly await key US data releases.

US GDP growth expected to slow down significantly in Q4 after stellar Q3

The United States Bureau of Economic Analysis will publish the first preliminary estimate of the fourth-quarter Gross Domestic Product at 13:30 GMT. Analysts forecast the US economy to have expanded at a 3% annualized rate, slowing down from the 4.4% growth posted in the previous quarter.

Week ahead – Markets brace for heightened volatility as event risk dominates

Dollar strength dominates markets as risk appetite remains subdued. A Supreme Court ruling, geopolitics and Fed developments are in focus. Pivotal Nvidia earnings on Wednesday as investors question tech sector weakness.

Official Trump price approaches breakout with mixed signals from traders

Official Trump (TRUMP) is trading at $3.50 at the time of writing, approaching its upper consolidation range. A breakout from this range could open the door for an upside move. On-chain data shows market indecision, with balanced flows between bulls and bears, signaling a lack of clear directional bias.