Weekly technical and trading outlook – GBP/USD

  Weekly GBP/USD technical outlook

Last Update At 03 Jan 2022 00:02GMT.

Trend daily chart

Sideways

Daily Indicators

Rising

21 HR EMA

1.3516

55 HR EMA

1.3496

Trend hourly chart

Up

Hourly Indicators

Bearish divergences

13 HR RSI

56

14 HR DMI

+ve

Daily analysis

Resumption of recent up move.

Resistance

1.3608 - Nov 09 2021 high.
1.3578 - 38.2% r of 1.3520-1.3162.
1.3550 - Last Fri's 6-week high.

Support

1.3499 - Last Wed's high (now sup).
1.3466 - Last Fri's low.
1.3455 - Last Thur's low.

GBP/USD - 1.3528. Cable continued its recent winning streak last week, price met renewed buying at 1.3389 (Mon) n ratcheted higher to 1.3521 Thur n then hit a 6-week peak of 1.3550 due partly to cross-buying in sterling Fri.

On the bigger picture, despite cable's brief break of 2016 post-Brexit low of 1.1491 to a near 35-year trough of 1.1412 in mid-Mar 2020 on safe-haven USD's demand following free fall in global stocks, price rallied to 1.3686 on the last trading day of 2020 following a last-minute EU-UK trade deal, then to a near 34-month, 1.4241 peak in late Feb suggests a major low is made. Despite hitting a 3-year peak of 1.4250 on Jun 01, selloff to as low as 1.3162 in Dec signals long-awaited correction has occurred. Having said that, cable's impressive rally to as high as 1.3550 last Fri confirms temporary low is made n daily close abv 1.3578 may head to 1.3708 but 1.3706 (50% r) should cap upside.

Today, cable's gain to 1.3550 suggests recent strong up move FM Dec's near 1-year bottom at 1.3162 remains in force n as long as 1.3466 holds, gain to 1.35 78 is likely, 'bearish divergences' on hourly indicators would cap price at 1.36 08. Below 1.3466 signals temporary top is made, yields 1.3432, then 1.3409.