Time Zone: GMT +3
Time Frame: 4 Hours (H4)
Fundamental Analysis:
GBP/USD traders should brace for heightened volatility today, driven primarily by key economic events. The GBP is under scrutiny with the Office for National Statistics releasing data regarding the UK’s public sector net borrowing. A lower-than-expected figure could strengthen GBP, indicating reduced budget deficits. Additionally, BOE Governor Andrew Bailey’s testimony on the Financial Stability Report will be closely monitored for hawkish signals on future monetary policy. On the USD side, Federal Reserve Chair Jerome Powell’s opening remarks at the Capital Framework Conference and the Richmond Fed Manufacturing Index could inject further volatility into the currency pair.
Price Action:
GBP-USD on the H4 chart maintains a long-term bullish trend despite a recent correction. The pair successfully found support within a critical support zone, validating buyers’ strength through successive bullish candles. The recent price action has broken the corrective movement’s resistance line, indicating a possible resumption of the bullish trajectory. If bullish momentum continues, the target zone marked clearly by historical price clusters could soon be reached.
Key Technical Indicators:
Parabolic SAR: The Parabolic SAR dots have flipped below the candlesticks, confirming a bullish reversal signal. This technical indicator strongly supports the continuation of the upward momentum in the GBPUSD H4 analysis.
RSI (Relative Strength Index): Currently positioned at approximately 59.70, the RSI indicates a neutral-to-slightly bullish sentiment. It shows room for further upside movement without approaching overbought territory, supporting the potential bullish continuation.
MACD (Moving Average Convergence Divergence): MACD indicates diminishing bearish momentum as the MACD line crosses above the signal line, reflecting renewed bullish momentum. Traders should watch for continued expansion of bullish histogram bars as a confirmation signal.
Support and Resistance:
Support: Immediate technical support is located around the recent low candle cluster near 1.3410-1.3385. A break below this zone could trigger a bearish correction.
Resistance: Immediate resistance is observed at the recent highs around the 1.3580-1.3625 area, coinciding with historical price reaction points.
Conclusion and Consideration:
GBP USD is positioned to resume its bullish trend on the H4 timeframe, backed by recent price action and supported by key technical indicators such as Parabolic SAR, RSI, and MACD. Today’s fundamental events involving key speeches from BOE’s Andrew Bailey and Fed Chair Jerome Powell may lead to increased volatility and rapid price movements. Traders should exercise caution and consider fundamental news impacts in their trading strategies, managing positions and risk accordingly.
Disclaimer: The analysis provided for GBP/USD is for informational purposes only and does not constitute investment advice. Traders are encouraged to perform their own analysis and research before making any trading decisions on GBPUSD. Market conditions can change quickly, so staying informed with the latest data is essential.
