Home » Technical Analysis » British Pound Trades Heavy around 1.3545

British Pound Trades Heavy around 1.3545

british

Looking at the above GBP/USD currency exchange rate on the above hourly MT 4 price chart, the British pound (GBP) is still trading around 1.3545 during the Asian trade session on Monday.

This benchmark Forex market has formed a bearish wedge chart pattern despite the signing of the trade agreement last week which improved trader sentiment.

There is nothing on today’s economic calendar which will make for a low volume trade day. We are in the final trade week of 2020 and economic data will be hard to come by. Overnight, outgoing President Donald Trump signed the emergency coronavirus (Covid-19) fiscal stimulus package into law.

This comes after several days of angst as he refused to sign the package. He wanted less pork in the bill and $2,000 dollar payment checks instead of the $600.

The cost of the president’s intransience not to sign on time almost resulted in the federal government shutting down as of midnight tonight. His delay did cost millions of Americans a week of unemployment benefit aid.

On 20 January President-elect Joe Biden will be sworn in as the next President of the United States. Trump has not yet conceded and his called Mr. Biden a “fake president” undermining the U.S. democratic process and riling his supporters.

Daily British Pound Technical Analysis (GBP/USD)

Looking at price action on the above GBP/USD hourly chart, the British pound has seen a number of pullbacks at the congestion zone in play at 1.3620 to 1.3624. The relative strength index (RSI) is normal as well. This is suggesting that there is more weakness ahead for the British currency as a bearish wedge chart pattern is taking shape.

With that said, a daily close below 1.3525, which also breaks below the two hundred (200) hour simple moving average (SMA) and opens the door to challenge the next downside barrier at 1.3460. The next layer of technical support lines up at 1.3190 with the next layer of technical support coming into play at 1.3135.

On the upside, a daily close above 1.3625 opens the door to break above the upper level of the rising wedge chart pattern. That layer of technical resistance lines up at 1.3630. The next layer of technical resistance lines up at March 2018 low price point at 1.3710.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

Check Also

gold

Gold Futures look to Stay Above $1,800 per Ounce

0.0 00 The spot gold futures contract is trading back above $1,800 per ounce after …