GBP/USD headed to 1.3500 amid thin trading?

DXY steadies near 3-month lows.
Risk-on underpins.
A quiet session ahead.

Dhwani Mehta FXStreet

The buying interest around the GBP/USD pair remained unabated in the Asian trades on final trading session of this year, as the bulls now head towards the key upside barrier located near 1.3465 levels.

GBP/USD to hold further upside?

The sentiment around the greenback remains broadly undermined amid subdued Treasury yields and uncertainty over the Fed rate hike prospects under Powell’s Presidency, leaving the USD index meandering near three-month troughs of 92.27.

Moreover, the higher-yield pound continues to take advantage of the risk-friendly market environment, as the Asian equities trade near yearly tops while oil prices climb to the highest levels since mid-2015.

In the day ahead, the bullish moves in Cable are expected to get exaggerated as volumes slow and volatility drops, with investors shifting their attention towards the New Year celebrations.

GBP/USD Technical Levels

According to Valeria Bednarik, Chief Analyst at FXStreet, “In the 4 hours chart, technical readings support another leg higher, as technical indicators head north above their mid-lines, with the Momentum firming up, but the RSI still below its previous daily highs. In the mentioned chart, the 20 SMA turned modestly higher around 1.3390, but is overall neutral, as its holding within its last two weeks' range. Support levels: 1.3410 1.3375 1.3340. Resistance levels: 1.3465 1.3500 1.3540.”

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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