Yahoo Finanza GBP/USD Tests Support At 1.3535
U.S. Dollar Gains Ground Against British Pound
GBP/USD is currently trying to settle below the support at 1.3535 while U.S. dollar is gaining ground against a broad basket of currencies.
The U.S. Dollar Index continues its attempts to settle above the 20 EMA at 95.70. In case the U.S. Dollar Index manages to settle above this level, it will gain upside momentum and move towards the next resistance at 96 which will be bearish for GBP/USD.
Today, foreign exchange market traders will have a chance to take a look at flash readings of PMI reports from UK. Analysts expect that UK Manufacturing PMI remained unchanged at 57.9 in January while UK Services PMI increased from 53.6 in December to 54.8 in January.
In the U.S., Manufacturing PMI is projected to decrease from 57.7 in December to 56.7 in January while Services PMI is expected to decline from 57.6 to 55.
Traders will also continue to monitor the developments in U.S. government bond markets. Treasury yields have started to move higher after the recent pullback, which is not surprising since traders are worried about Fed’s moves ahead of Fed Interest Rate Decision which will be released on Wednesday. In case Treasury yields get to the test of the recent highs, the American currency will get more support.
Technical Analysis
GBP/USD managed to settle below the 20 EMA at 1.3570 and is currently trying to settle below the next support level which is located at 1.3535. In case GBP/USD declines below the support at 1.3535, it will head towards the next support at the 50 EMA at 1.3510.
A successful test of the support at the 50 EMA at 1.3510 will push GBP/USD towards the support at 1.3490. If GBP/USD declines below this level, it will head towards the next support level at 1.3465.
On the upside, the previous support at the 20 EMA will serve as the first resistance level for GBP/USD. If GBP/USD manages to settle above this level, it will head towards the resistance at 1.3600. In case GBP/USD gets above 1.3600, it will head towards the resistance at 1.3635.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
