12.01.202113:53 Forex Analysis & Reviews: Analysis and forecast for GBP/USD on January 12, 2021

In yesterday's trading, the pound/dollar currency pair showed a downward trend. However, if we compare the decline of the "British" with the single European currency, it was not so significant and even leaves the chances of sterling's subsequent growth against the US dollar.

Daily

This can be judged by the long lower shadow of yesterday's daily candle. As you can see, the support in the area of 1.3440 was strong enough to return the British currency to an upward trend. This is exactly what is observed at the time of writing this article. Compared to the euro, the pound shows a fairly strong growth against the dollar and the GBP/USD currency pair is trading near a fairly strong mark of 1.3600, or rather directly below this level. It is worth noting that the pair breaks up the red Tenkan line of the Ichimoku indicator. If today's trading closes above this line and the level of 1.3600, the chances of further strengthening of the pound will increase significantly. In this case, the nearest targets for possible growth will be 1.3631, 1.3670 and the important technical mark of 1.3700. Given the long lower shadow of yesterday's candle, we can assume that market participants do not want to sell the British currency anymore and have actively moved to buy it, which is clearly demonstrated by the picture on the daily chart of GBP/USD. Thus, we will bet on the growth of the pound against the dollar and look for points to open long positions in smaller time intervals.

H1

On the hourly chart, the strong growth of the British currency is clearly visible, which has come close to the local resistance line of 1.3670-1.3634 and has already begun to test it for a breakdown. If you go to the trading recommendations for the GBP/USD currency pair, then the priority is for purchases. However, opening long positions under the resistance line is very risky and technically incorrect. I suggest waiting for the breakdown of this line, fixing three consecutive hourly candles above, and already on the rollback to the broken line to open a deal to buy. At the same time, I would like to note and remind you that the pound often makes false breakouts, after which the price returns under or above the seemingly already broken levels and (or) lines.

In the case of the appearance of reversal patterns of candle analysis under the purple resistance line of 1.3670-1.3634, you can sell the pair briefly, however, judging by the huge bullish candle highlighted, the players' intentions to increase the rate are very serious, which means that the resistance line will still be broken and the growth is likely to continue. Today, no British and American macroeconomic reports are scheduled to be released, however, there will be many speeches by monetary officials from the Fed. Perhaps they will make some changes in the price dynamics of the US currency in general and the pound/dollar pair in particular. In the meantime, you should expect growth and prepare for purchases after a true breakdown of the hourly resistance line.