The British pound is trading above the key support of 2/8 of murray. Yesterday, we saw this critical level break for a few hours but then, in the European session, the pair is consolidating above this zone. For a while, 1.3427 is support that we must consider. Any pullback towards this area will be a good opportunity to buy.
This technical rebound of the GBP / USD pair comes in part due to the fact that the US dollar has reached a key resistance level near the +2/8 level of murray located at 94.53 that means an extremely overbought market. From this area, it is making a technical correction and all currency pairs against the US dollar are taking a breather and correcting after strong pressure from the USD.
The daily chart of the GBP / USD pair shows that the pound is trading within a downtrend channel. At this time of writing, the pair is trading at .3450. It is likely that a technical rebound will continue due to the technical correction of the US dollar and the strong support at 1.3427.
The short-term outlook is still bearish as the 200 EMA and the 21 SMA are located at 1.3715 which represents strong dynamic resistance, which keeps the pair under downward pressure.
Therefore, if in the next few days the British pound tries to break the level of 1.3715 and does not succeed, it will be a clear signal to sell below both moving averages. The targets will be the support levels of 1.3550 and 1.3427.
Meanwhile, according to the scenario that is observed, we believe that it will be a good opportunity to buy at the current price levels, with targets at 1.3550 that is 3/8 of a murray. Between this level and the support of 1.3427, it will be the next price range until the next week when the NPP data is published.
A breakout and consolidation above 1.3550 would set the stage for a bullish move aiming to challenge the 200 EMA located at 1.3715 and the 4/8 Murray located at 1.3671, which has now become strong resistance.
Our strategy is to buy above 1.3427 as long as the pair consolidates above this level or makes a technical bounce above this point, with targets up to 1.3550 and 1.3670. If the price encounters resistance at both levels and fails to consolidate, this will be a good opportunity to sell.
Support and Resistance Levels for September 30 - October 01, 2021
Resistance (3) 1.3550
Resistance (2) 1.3512
Resistance (1) 1.3660
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Support (1) 1.3427
Support (2) 1.3370
Support (3) 1.3319
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Trading tip for GBP/USD for September 30 - October 01, 2021
Buy above 1,3450 or if the pair rebounds at 1,3427 (2/8) with take profit at 1,3500 and 1,3550 (3/8), stop loss below 1,3415.
