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GBP/USD Trade Analysis

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Daily chart

GBP/USD Trade Analysis


4-Hour chart

GBP/USD Trade Analysis


Current Trend: Stuck in box / range.

Support Levels: 1.2762.

Resistance Levels: 1.3000.


GBP/USD trade ideas:

We have discussed this market at length in recent times.

In particular we have focused on the major round number 'psych' level of 1.3000 that has continued to hold as a major resistance level in this market.

After selling off lower last time from this level, price was not able to make it all the way back to the range low and has now created a new intraday higher low.

As the attached four-hour chart shows, this could now indicate the bears are running out of steam and a breakout higher could be on the cards in the next few sessions.

This is definitely a market to watch for potential breakout trades.

Edited 08 Oct 2020, 12:56

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A key catalyst would be the outcome of the Brexit deal - we are only less than a week away from PM Boris Johnson's deadline of Oct 15 - with no firm trade deal in sight, this could weaken the GBP. Hard to predict with the USD these days though - traditionally, the dollar tends to soften leading up to US presidential elections, but it's been swinging up and down so far...
GBP/USD failed to capitalize on its intraday positive move to the 1.2970 region. Dovish sounding comments by the BoE Governor Bailey took its toll on the pound.

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