In the early European session, the GBP / USD pair is trading below SMA 21 and above the 200 EMA. Besides, it is also trading below the key resistance 8/8 murray located at 1.4160. If the pair breaks the 200 EMA, there could be a drop to the bottom of the sloping line of the bearish channel located at around 1.4029.
The GBP / USD pair is under downward pressure due to the fact of trading below the SMA of 21. The currency pair is expected to fall to the psychological level of 1.40. This downward bias is also due to the uncertainty before the data to be published in the US and with the start of the two-day meeting of the Federal Reserve.
In the United Kingdom, there is also no encouraging data that could give strength to the pound sterling. The economy is being affected by the prospects of the delayed return to normality. Lifting lockdown measures is delayed by four more weeks and this may also weaken GBP. While the pair remains below 1.4160, it is expected to be under strong downward pressure in the short term.
The USDX Dollar Index also remains bullish above the psychological level of 90.00, which means that it will continue to hold the upper hand over all pairs with the US dollar, including the British pound.
Tomorrow in the American session, the decision of the FED will be a key event that will have a wide impact on the markets and may generate strong volatility in all pairs with the US dollar. No major changes are expected in the Fed's monetary policy, but the Fed's stance and message about next policy moves will be closely watched by analysts.
Our recommendation is to sell below the 200 EMA with targets at the bottom of the bearish channel or buy around this level with targets at the 21 SMA located at 1.4125.
Support and Resistance Levels for June 15 – 16, 2021
Resistance (3) 1.4152
Resistance (2) 1.4128
Resistance (1) 1.4098
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Support (1) 1.4056
Support (2) 1.4044
Support (3) 1.4005
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Trading tip for GBP/USD for June 15 - 16, 2021
Sell below 1.4090 (EMA 200), with take profit at 1.4029, stop loss above 1.4125.
Buy if rebound around 1.4029, (trend line), with take profit at 1.4125 (SMA 21), stop loss below 1.4000.
