GBP/USD keeps pushing higher and approaches 1.3400 area


  • GBP/USD’ appreciates for the fourth consecutive day and approaches 1.3400.
  • The pound shrugs off the historical budget deficit and the grim economic outlook.
  • GBP/USD still aiming to 1.3400 and beyond – UOB.

 

The sterling remains trading on a strong note and has appreciated for the fourth consecutive day on Wednesday, extending its rebound from last week’s lows at 1.3100 to session highs a handful of pips below 1.3400.

The pound has been unfazed by the record UK borrowing plan, nor by the bleak economic outlook depicted by the finance minister Rishi Sunak earlier on Wednesday and has maintained its positive trend against the US dollar to test 12-week highs at 1.3395.

The finance minister has announced a plan to borrow £400 B to offset the devastating economic impact of the COVID-19 pandemic. This will be the highest budget deficit in peacetime. Beyond that, Sunak revealed that UK economy will contract at an 11.3% pace in 2020, the largest economic decline in 300 years, to recoup only half of that loss in 2021.

Cable remains underpinned by hopes that a COVID-19 vaccine might be available early next year and investors’ confidence on a Brexit deal before the end of the transition period on December 31.

GBP/USD targeting 13400 and beyond – UOB

From a technical point of view, the FX Analysis team at UOB sees the pair aiming higher, while above 1.3200: “The underlying tone has firmed somewhat and we see a chance for GBP to edge upwards to 1.3400. At this stage, the prospect for a sustained advance above this level is not high (next resistance is at 1.3440). Support is at 1.3335 followed by 1.3300.”

Technical levels to watch

GBP/USD

Overview
Today last price 1.339
Today Daily Change 0.0028
Today Daily Change % 0.21
Today daily open 1.3362
 
Trends
Daily SMA20 1.3149
Daily SMA50 1.3018
Daily SMA100 1.2998
Daily SMA200 1.2722
 
Levels
Previous Daily High 1.338
Previous Daily Low 1.3293
Previous Weekly High 1.3312
Previous Weekly Low 1.3166
Previous Monthly High 1.3177
Previous Monthly Low 1.282
Daily Fibonacci 38.2% 1.3347
Daily Fibonacci 61.8% 1.3326
Daily Pivot Point S1 1.331
Daily Pivot Point S2 1.3258
Daily Pivot Point S3 1.3222
Daily Pivot Point R1 1.3397
Daily Pivot Point R2 1.3433
Daily Pivot Point R3 1.3485

 

 

 

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