04.01.202111:45 Forex Analysis & Reviews: Technical analysis of GBP/USD for January 04, 2021

Pound Sterling - US Dollar :

In the first week of 2021, the bullish dynamics of the GBP/USD currency pair is expected with an optimal trading above the area of 1.3550 - 1.3590.

An uptrend is expected on the GBP/USD currency pair. The average price for the period is 1.3557 ( 50% of Fibonacci retracement levels, major support). Minimum prices are predicted at the level of: 1.3557. The maximum value of quotes: 1.3760.

According to the previous events, the GBP/USD pair is still moving between the levels of 1.3557 and 1.3760; for that we expect a range of 203 pips (1.3760 - 1.3557).

On the one-hour chart, the GBP/USD pair continues moving in a bullish trend from the support levels of 1.3557 and 1.3587. Currently, the price is in a bullish channel.

This is confirmed by the RSI indicator signaling that we are still in a bullish trending market. As the price is still above the moving average (100), immediate support is seen at 1.3587, which coincides with a golden ratio (61.8% of Fibonacci).

Consequently, the first support is set at the level of 1.3587. So, the market is likely to show signs of a bullish trend around the spot of 1.3587/1.3557.

In other words, buy orders are recommended above the golden ratio (1.3587) with the first target at the level of 1.3685. Furthermore, if the trend is able to breakout through the first resistance level of 1.3685. We should see the pair climbing towards the next targets of 1.3720 and 1.3760.

It would also be wise to consider where to place a stop loss; this should be set below the second support of 1.3526.

Forecast :

Uptrend scenario : An uptrend will start as soon, as the market rises above resistance level 1.3587, which will be followed by moving up to resistance level 1.3760 (R3). However, the stop loss should always be taken into account, for that it will be reasonable to set your stop loss at the level of 1.3526.