GBP/USD Forecast: Pound Sterling holds above key support levels, encouraging buyers
Premium|Take advantage of 50% OFF on your first month.
Start your subscription and get access to all our original articles.
You have reached your limit of 5 free articles for this month.
Get Premium without limits for only $479.76 for the first month
Access all our articles, insights, and analysts.
UNLOCK OFFER- GBP/USD started to edge higher toward 1.2700 after posting gains on Wednesday.
- Pound Sterling could gather bullish momentum if it reclaims 1.2740.
- ADP Employment Change will be featured in the US economic docket.
Despite the risk-averse market environment and the persistent US Dollar (USD) strength, GBP/USD registered modest gains on Wednesday. Early Thursday, the pair continues to edge higher toward 1.2700.
The hawkish tone seen in the minutes of the Federal Reserve's (Fed) December policy meeting, combined with a sharp decline in Wall Street's main indexes, helped the USD gather strength mid-week. GBP/USD, however, held its ground throughout the day. The sharp decline seen in EUR/GBP on Wednesday suggested that Pound Sterling captured capital outflows out of the Euro to stay resilient against its rivals.
Pound Sterling price this week
The table below shows the percentage change of Pound Sterling (GBP) against listed major currencies this week. Pound Sterling was the strongest against the Japanese Yen.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | 1.06% | 0.33% | 0.56% | 0.81% | 1.58% | 0.64% | 0.84% | |
| EUR | -0.91% | -0.56% | -0.35% | -0.09% | 0.53% | -0.26% | -0.12% | |
| GBP | -0.34% | 0.56% | 0.24% | 0.44% | 1.37% | 0.31% | 0.44% | |
| CAD | -0.56% | 0.31% | -0.06% | 0.23% | 1.02% | 0.06% | 0.23% | |
| AUD | -0.81% | 0.10% | -0.47% | -0.26% | 0.59% | -0.17% | 0.03% | |
| JPY | -1.61% | -0.52% | -1.20% | -0.84% | -0.64% | -0.80% | -0.81% | |
| NZD | -0.64% | 0.28% | -0.31% | -0.08% | 0.17% | 0.77% | 0.15% | |
| CHF | -0.79% | 0.13% | -0.44% | -0.21% | 0.00% | 0.76% | -0.14% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
In the second half of the day, private sector employment data from the US could impact the USD's valuation.
Markets forecast ADP Employment Change to come in at 115,000 in December, following November's disappointing increase of 103,000. In case private sector employment rises more than 150,000, the initial reaction could provide a boost to the USD, with investors pricing in an upbeat Nonfarm Payrolls print on Friday. On the other hand, a reading below 100,000 could attract dovish Fed bets and weigh on the USD.
Investors will also pay close attention to Wall Street. Major equity indexes in the US lost about 1% on Wednesday. Early Thursday, US stock index futures trade modestly higher on the day. An improvement in risk mood following the opening bell could make it difficult for the USD to find demand and support GBP/USD in the second half of the day.
GBP/USD Technical Analysis
GBP/USD turned north after testing 1.2650-1.2640 support area, where the 200-period Simple Moving Average (SMA) and the Fibonacci 23.6% retracement of the latest uptrend are located. The pair faces interim resistance at 1.2700 (psychological level, static level) before 1.2740 (lower-limit of the long-term ascending regression channel). In case GBP/USD returns within the ascending channel by stabilizing above 1.2740, it could target 1.2800 (psychological level, static level) next.
On the downside, immediate support is located at 1.2680 (100-period SMA) before 1.2650-1.2640 and 1.2600 (psychological level, static level).
- GBP/USD started to edge higher toward 1.2700 after posting gains on Wednesday.
- Pound Sterling could gather bullish momentum if it reclaims 1.2740.
- ADP Employment Change will be featured in the US economic docket.
Despite the risk-averse market environment and the persistent US Dollar (USD) strength, GBP/USD registered modest gains on Wednesday. Early Thursday, the pair continues to edge higher toward 1.2700.
The hawkish tone seen in the minutes of the Federal Reserve's (Fed) December policy meeting, combined with a sharp decline in Wall Street's main indexes, helped the USD gather strength mid-week. GBP/USD, however, held its ground throughout the day. The sharp decline seen in EUR/GBP on Wednesday suggested that Pound Sterling captured capital outflows out of the Euro to stay resilient against its rivals.
Pound Sterling price this week
The table below shows the percentage change of Pound Sterling (GBP) against listed major currencies this week. Pound Sterling was the strongest against the Japanese Yen.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | 1.06% | 0.33% | 0.56% | 0.81% | 1.58% | 0.64% | 0.84% | |
| EUR | -0.91% | -0.56% | -0.35% | -0.09% | 0.53% | -0.26% | -0.12% | |
| GBP | -0.34% | 0.56% | 0.24% | 0.44% | 1.37% | 0.31% | 0.44% | |
| CAD | -0.56% | 0.31% | -0.06% | 0.23% | 1.02% | 0.06% | 0.23% | |
| AUD | -0.81% | 0.10% | -0.47% | -0.26% | 0.59% | -0.17% | 0.03% | |
| JPY | -1.61% | -0.52% | -1.20% | -0.84% | -0.64% | -0.80% | -0.81% | |
| NZD | -0.64% | 0.28% | -0.31% | -0.08% | 0.17% | 0.77% | 0.15% | |
| CHF | -0.79% | 0.13% | -0.44% | -0.21% | 0.00% | 0.76% | -0.14% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
In the second half of the day, private sector employment data from the US could impact the USD's valuation.
Markets forecast ADP Employment Change to come in at 115,000 in December, following November's disappointing increase of 103,000. In case private sector employment rises more than 150,000, the initial reaction could provide a boost to the USD, with investors pricing in an upbeat Nonfarm Payrolls print on Friday. On the other hand, a reading below 100,000 could attract dovish Fed bets and weigh on the USD.
Investors will also pay close attention to Wall Street. Major equity indexes in the US lost about 1% on Wednesday. Early Thursday, US stock index futures trade modestly higher on the day. An improvement in risk mood following the opening bell could make it difficult for the USD to find demand and support GBP/USD in the second half of the day.
GBP/USD Technical Analysis
GBP/USD turned north after testing 1.2650-1.2640 support area, where the 200-period Simple Moving Average (SMA) and the Fibonacci 23.6% retracement of the latest uptrend are located. The pair faces interim resistance at 1.2700 (psychological level, static level) before 1.2740 (lower-limit of the long-term ascending regression channel). In case GBP/USD returns within the ascending channel by stabilizing above 1.2740, it could target 1.2800 (psychological level, static level) next.
On the downside, immediate support is located at 1.2680 (100-period SMA) before 1.2650-1.2640 and 1.2600 (psychological level, static level).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.