GBP/USD was rocking and rolling on endless Brexit headlines. What’s next? The GDP report stands out in the new week. Here are the key events and an updated technical analysis for GBP/USD.
UK PM Theresa May gave a successful speech at the Tory Conference and shrugged off the potential challenge from Boris Johnson. While she insisted that the UK is ready to leave the EU without a deal, reports about potential UK concessions on the Irish border circulated and supported the pound. Upbeat US data, rising US yields, and a optimistic words from Fed Chair Powell supported the greenback.
GBP/USD daily graph with resistance and support lines on it. Click to enlarge:
* All times are GMT
GBP/USD Technical analysis
Pound/dollar made an attempt to recover but hit the 1.3215 level mentioned last week. It then fell sharply and stopped only at 1.3000.
Technical lines from top to bottom:
1.3375 was a high point in July. It is followed by 1.3300 was the high point in September and also a psychologically important round number.
1.3215 was the high point for the pair in mid-July and a lower high on the chart. The round number of 1.3100 supported the pair earlier in September.
1.3045 provided support in September and beforehand capped the pair in August. The round number of 1.3000 is important after providing support to the pair in late September.
1.2920 was a low point in early October. 1.2850 separated ranges in the last days of August and the first days of September.
Further down, 1.2790 served as support late August and also beforehand. 1.2750 held the pair down when the pair was on the back foot.
The current 2018 trough at 1.2660 is the next level. 1.2590 was a swing low in September 2017.
Even lower, 1.25 is a round number and also worked as support in early 2017.
I am bullish on GBP/USD
The Conservative Party conference is over and it’s time to cut a deal on Brexit. The EU Summit on Brexit is only on the following week, but we may hear more positive words that can lift Sterling from its misery. In addition, an OK GDP can also support the pound.
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