GBP/USD Forecast: Possible extension towards 1.3715

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3650

BOE’s Governor Bailed cooled speculation of negative rates in the UK.
December retail sales missed expectations according to BRC estimates.
GBP/USD is bullish in the near term and could advance beyond the 1.3700 figure.

The British Pound was the best performer against the greenback this Tuesday, with GBP/USD hitting 1.3651, to close the day a handful of pips below the level. The sterling got boosted by Bank of England’s Governor Andrew Bailey, who cooled expectations of negative rates, after noting that they are a controversial issue. He also said that it’s too early to reach any conclusion about the need for future stimulus.

The UK published the December BRC Like-For-Like Retail Sales, which posted a modest 4.8%, missing the expected 7.9% advance and below the previous 7.7%. The country won’t release macroeconomic data this Wednesday.

GBP/USD short-term technical outlook

The GBP/USD pair is on its way to extend the latest advance. The 4-hour chart shows that it has broken above a descendant trend line coming from 1.3703, this month’s high. The pair advanced beyond all of its moving averages, which head just modestly up. The Momentum indicator lacks directional strength around its midline, but the RSI advances around 59, skewing the risk to the upside.

Support levels: 1.3590 1.3540 1.3495

Resistance levels: 1.3670 1.3715 1.3750

View Live Chart for the GBP/USD

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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