Market Overview

GBP/USD Forecast: Sterling Pulls Back From 15-Week High Targeting 50% Fibonacci Retracement At 1.3250

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  • The GBP/USD rose to 1.3214, the highest level since October 16 last year backed by rising hopes of avoiding hard Brexit scenario.
  • The UK Prime Minister Theresa May privately the government members that the UK will avoid the hard Brexit.
  • The European Commission has proposed arrangements on aviation and road haulage if there is no deal, allowing British truckers to carry goods into the EU and British airlines to fly in and out of the EU, from 29 March to 31 December.

The GBP/USD is trading little changed on the downside at around 1.3160 after rising to a 15-week high of 1.3214 last Friday on increased hopes for no-deal Brexit being avoided by the UK government.

Sterling was boosted last Friday by news of the junior coalition DUP party supporting a new Brexit deal in parliament and the reports indicating that the UK Prime Minister Theresa May will avoid a heard Brexit scenario.

The latest news indicates that the scenario of hard Brexit is out of play, supporting Sterling across the board. The Bank of England Governor Mark Carney is set to participate in a panel discussion about the future of money at the Bank of England's Future Forum, in London. 

Technically the GBP/USD jumped above downward sloping trendline and breaking above 1.3000 it has also conquered the major resistance line representing 38.2% Fibonacci retracement of the upmove from 1.2130 to 1.4177.

The technical oscillators including the Relative Strength Index and Slow Stochastics are both elevated with Slow Stochastics making the bearish crossover in the Overbought territory. The GBP/USD rose to a fresh 15-week high of 1.3214 and the GBP/USD is set to experience the corrective pullback on Monday. The bullish breakout of the Fibonacci level of 1.2990-1.3000 becomes a support level now and the first price target on the downside.  On the upside, the immediate resistance is at around 1.3250 representing 50% Fibonacci retracement of above-mentioned rise from 1.2130 to 1.4177.

The GBP/USD daily chart

gbp_usd_daily-636842603557379295.png

Posted-In: Brexit Europen Union Fibonacci FXStreet GBP/USDEurozone Forex Markets

 

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