Looking at the GBP/USD currency exchange rate, the British pound remains under pressure against the almighty U.S. dollar. Price action is also below the two hundred (200) day simple moving average as we head into a new trade week.
The British pound took a safe haven hit which benefited the greenback. Surging Delta coronavirus (Covid-19) cases in both the United States and the United Kingdom are worrying Forex traders. So is Afghanistan where the Taliban have seized power.
Monday’s economic calendar is all about purchasing mangers’ indices. The private initial monthly IHS Markit manufacturing and services purchasing mangers’ indices for the United Kingdom will be released. Also, the private initial monthly IHS Markit manufacturing and services purchasing mangers’ indices for the United States will also be published.
The Chicago Federal Reserve branch will publish their national activity index for July. The private initial monthly IHS Markit manufacturing and services purchasing mangers’ indices (PMI) for the European Union and Germany are scheduled for publication. Also, the euro area will release their initial monthly consumer confidence index.
Daily British Pound Technical Analysis (GBP/USD)
Looking at the above daily MT 4 price action chart, as mentioned above, the British pound is now below the 200 day simple moving average. The 14 day relative strength index (RSI) is also above thirty. This signals possible oversold conditions in the GBP/USD Fore market.
While trading above 1.3560, which is the monthly low price level in July, losses in the GBP/USD currency exchange rate could be limited. This could open the door for a possible corrective challenge of 1.40. Immediate upside resistance lines up at 1.3660 with the next upside level lining up at 1.3740. The next level of technical resistance comes into play at 1.3880.
On the downside, immediate technical support lines up at 1.3560. The key psychological level at 1.35 then comes into focus before 1.3450 coming into play.