According to the 1-hour chart, we can see that GBP / USD is trading below the downtrend channel formed since October 29. A sharp break above the downtrend channel could be the beginning of a new bullish scenario with targets towards the 200 EMA located around 1.3313 if this level is broken to 6/8 of Murray at 1.3427.
The Bank of England (BoE) is expected to raise interest rates on December 16. However, speculations that the Omicron variant of the coronavirus could affect the economic recovery could act against the British pound and could lead it to fall to the psychological level of 1.30.
In the past few hours, the pound rebounded off Friday's low around 1.3207. GBP/USD has managed to consolidate above the SMA of 21 (1.3238). It could be the light at the end of the tunnel for GBP / USD. If the pair settles above this level, it can rise to 1.3313 and 1.3427.
In the 1-hour chart, GBP/USD began a formation of a symmetrical triangle, but the process was disrupted. Now we hope that the currency pair gains momentum while waiting for the demand to increase to overcome the barrier of the bearish channel.
Our forecast in the next few hours for the British pound is a consolidation above 1.3238 (21 SMA). As long as GBP/ USD is trading above this zone, we will have an opportunity to buy with the target at 1.3305 and 1.3313 (200 EMA). If 5/8 is broken, we could sell with targets at 1.3427 (6/8).
The market sentiment report for today, November 29, shows that there are 74.20% of operators who are buying the GBP/ USD pair. This data provided a bearish sign in the short-term (It is bearish because investors act against the trend). Therefore, the price may again resume its downward movement with the target at 1.3183 (4/8). This will happen if GBP trades below 1.3313 (200 EMA).
The eagle indicator is showing a bearish bias, moving below a trend channel. The British currency could extend its weakness in the next days until reaching the support in 4/8 of Murray around 1.3184. If it succeeds in consolidating above 1.3313, then it could gain strength and a trade volume to rise to 1.3430.
Support and Resistance Levels for December 06 - 07 2021
Resistance (3) 1.3349
Resistance (2) 1.3305
Resistance (1) 1.3288
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Support (1) 1.3186
Support (2) 1.3145
Support (3) 1.3086
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A trading tip for GBP/USD on December 06 - 07, 2021
Buy in case of a rebound at 1.3238 (21 SMA) with take profit at 1.3313 (200 EMA) and 1.3427 (6/8), stop loss below 1.3195.
