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British Pound (GBP) Worth Outlook: GBP/USD Approaching Key Assist Ranges

british-pound-(gbp)-worth-outlook:-gbp/usd-approaching-key-assist-ranges

GBP value, information and evaluation:

  • GBP/USD continues to look weak as a powerful US Greenback outperforms most different currencies.
  • Nevertheless, trendline assist and the 1.33 stage may at the very least delay additional losses.

GBP/USD to check assist

GBP/USD has hit its lowest stage since simply earlier than Christmas final yr and there are few indicators but that its slide in opposition to a rampant US Greenback is over. Nevertheless, there’s a likelihood now that its decline may very well be halted, maybe solely briefly, by some necessary assist ranges slightly below the present value.

GBP/USD Worth Chart, Day by day Timeframe (December 2, 2020 – November 25, 2021)

Latest GBP/USD price chart

Supply: IG (You possibly can click on on it for a bigger picture)

Particularly, because the chart above reveals, it’s now near a trendline connecting the decrease lows in place since mid-April and which sits at the moment round 1.3290. That’s slightly below the 1.33 “spherical quantity” that would additionally present some assist forward of the December 2020 lows at 1.3188 after which 1.3134.

From a elementary perspective there may be nothing new to maneuver the Pound forward of the December 16 assembly of the Financial institution of England’s financial coverage committee, which is extensively anticipated to extend UK rates of interest.

Meaning actions in GBP/USD shall be largely dictated by the US Greenback, which is benefiting from indications that the Federal Reserve will taper its assist for the markets and lift rates of interest before as soon as anticipated because the climb in US shopper costs seems to be accelerating.

As for sentiment, IG consumer positioning knowledge proceed to ship out a bearish contrarian sign. The retail dealer knowledge present 74.24% of GBP/USD merchants are net-long, with the ratio of merchants lengthy to brief at 2.88 to 1. The variety of merchants net-long is 1.89% greater than yesterday and eight.91% greater than final week, whereas the variety of merchants net-short is 3.78% decrease than yesterday and 13.67% decrease than final week.

Right here at DailyFX, we usually take a contrarian view to crowd sentiment, and the very fact merchants are net-long suggests GBP/USD could proceed to fall.Merchants are additional net-long than yesterday and final week, and the mix of present sentiment and up to date adjustments provides us a stronger GBP/USD-bearish contrarian buying and selling bias.

— Written by Martin Essex, Analyst

Be at liberty to contact me on Twitter @MartinSEssex

DailyFX offers foreign exchange information and technical evaluation on the developments that affect the worldwide foreign money markets.

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