- The GBP/USD pair could extend its downside movement as long as it stays under the downtrend line.
- Stabilizing above the 1.3275 level and making a valid breakout above the downtrend line could signal potential growth towards the upper median line.
- DXY’s further growth could force the pair to approach and reach new lows.
Our GBP/USD forecast shows the pair dropping like a rock as the USD was boosted by the Dollar Index rally. The DXY has managed to rebound and now it tries to erase its losses registered after the FOMC. The greenback drags the pair lower, so DXY’s further growth could push the GBP/USD pair even lower.
The British Pound drops even if the UK reported better than expected figures today. The Retail Sales registered a 1.4% growth in November versus 0.8% expected and compared to 1.1% growth in October. Also, the Gfk Consumer Confidence was reported at -15 points below -17 points expected.
On Monday, the UK CBI Industrial Order Expectations could be reported at 20 points below 26 points in the previous reporting period. On the other hand, the CB Leading Index is expected to register a 0.8% growth.
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3 Free Forex Every Week – Full Technical Analysis
Dollar Index Forecast: Technical Analysis – Range Formation
The DXY registered only false breakdowns below the 95.98 static support and now is traded at 96.35. Today’s rebound helped the USD to appreciate versus its rivals. Potential further growth towards the 96.64 could help the USD to dominate the currency market in the short term.
GBP/USD Forecast: Technical Analysis – Sell-Off
As you can see on the H4 chart, the GBP/USD pair failed to stabilize above the 1.3353 or to reach the descending pitchfork’s upper median line (UML) signaling that the buyers are exhausted. Now, it’s traded at 1.3268 below 1.3275 static support. Stabilizing under this downside obstacle could announce more declines.
The GBP/USD pair could start increasing again if it comes back and if it stabilizes above 1.3275. Invalidating its breakdown and making a valid breakout above the immediate downtrend line may announce potential rally towards the upper median line (UML).
In the short term, the price could extend its sell-off as long as it stays below the downtrend line. 1.3201 stands as a major downside target and obstacle.
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