11.08.202010:32 Forex Analysis & Reviews: Analysis and forecast for GBP/USD on August 11, 2020

Hello, dear traders!

In contrast to the euro/dollar, the GBP/USD currency pair showed strengthening in yesterday's trading. However, it was rather restrained, as market participants expected today's publication of labor statistics from the UK.

And now, recently, it became known that the unemployment rate in the UK remained at the June value of 3.9%, although experts expected an increase to 4.2%. But the number of applications for unemployment benefits rose much higher than the consensus forecast of 10 thousand, and in fact amounted to 94.4 thousand applications. Given the negative impact of the COVID-19 pandemic on the British economy, such ambiguous figures are understandable, and it cannot be otherwise. It is still good that unemployment not only did not increase, but held on to the previous value. Regarding the British economy, many analysts have no illusions, and present its future in rather gloomy tones. In addition to COVID-19, market participants are concerned about the Brexit deal. Let me remind you that it is not yet fully clear whether the UK will leave the European Union with or without a deal. In the first case, it is important what the intended transaction will be in terms of the presence and importance of compromises. However, this issue should be finally resolved before the end of this year, so there is still time. And it's time for us to move on to the analysis of the price charts of the pound/dollar currency pair.

Daily

As noted at the very beginning of this article, the pair ended Monday's trading with a very slight increase. However, trading on August 10 closed above the Tenkan line of the Ichimoku indicator. Another positive moment for the bulls on the pound was the fact that the pair did not reach the previous lows of 1.3008, and began to recover from 1.3017.

After the release of ambiguous labor statistics from the UK, the British currency began to experience selling pressure, and at the moment of writing, the pair is trading near 1.3065.

The key support is still held in the price zone of 1.3008-1.2980. If it is broken, the pair risks falling to the area of 1.2825-1.2800, where the Kijun line of the Ichimoku indicator passes, the broken resistance of sellers at 1.2811 and the important technical level of 1.2800.

Regarding the bullish scenario, everything is much more complicated. As noted in yesterday's article on this currency pair, the weekly "Rickshaw" candle, which is considered a reversal model, does not bode well for players to increase the exchange rate. The bulls will gain control of the pair only in the case of a true breakout of the resistance at 1.3184, and the buyers' intentions will become even more obvious only after the break of the 1.3200 mark.

H4

As you can see, for a long time, the pair was trading in close proximity to the 50 simple moving average, however, it was not able to break through this moving average. At the moment of completion of the article, there is a decline in the exchange rate, the continuation of which will lead to another test of the strong support zone of 1.3008-1.2980. At the same time, I do not rule out a false breakdown and the price will fly lower to 1.2968. Here is a black 89 exponential moving average, which can provide support and push the pair up.

According to trading recommendations, the current situation is quite uncertain and difficult to make decisions on entering the market. At the moment, the weekly forecast of a decline in GBP/USD remains relevant. If the pair is fixed with three candles in a row under 50 MA, you can try opening sell deals on the pullback to this moving average. Aggressive and risky, you can try to sell at current prices.

An alternative option for positioning for GBP/USD will be the appearance of bullish candles in the support zone of 1.3020-1.2980 on the four-hour and hourly charts. At the same time, in both cases, I would refrain from setting large goals for the time being.

Good luck!