GBPUSD Daily Forecast On Wednesday, the Pound Sterling rallies toward a seven-week high against the US Dollar, according to the current chart. Democrats have won both the US House of Representatives and the US Senate in the ongoing US midterm elections. This is indeed a devastating blow to US President Donald Trump. Notably, Donald Trump congratulates the Democrats and is ready to engage in discussions. In fact, Pound Sterling currently trades just above the $ 1.3500 level, up 0.55%. Meanwhile, the US Dollar Index has posted negative returns today near the $101.41 level. According to the news release, the US Dollar Index fell nearly 0.50% as voters elected Democrats to balance President Trump's power. Moreover, US Bond yields fell amid rising US stock indexes. Some experts highlighted the importance of divided government, saying that whenever markets saw no party pass any bill with party-line majorities, markets tended to perform quite well. Concerning the US-Iran tensions, talks progressed despite reports from Iran saying that a US drone had been shot down. According to CCTV, quoting unnamed sources, a senior Iranian diplomat said Tehran is far from sealing a deal with Washington that would help end hostilities. Nonetheless, oil prices edged lower due to expectations that the two countries might reach a deal soon. The October ISM Services Purchasing Managers' Index (PMI) in the United States came in worse than expected at 54.5, down from 54.9 and missing expectations of 54.8. Breaking down the report, employment improved, while new orders and prices paid fell yet stayed positive. Previously, the October ADP Employment Change showed unchanged hiring among corporations in the country, with the former adding 86k jobs, beating expectations of 69k. For now, money markets expect the BoE to raise rates by 100 basis points on Thursday. Yet, looking ahead to December's decision, there is a 26% probability of another Bank Rate hike. Looking ahead to tomorrow, Initial Jobless Claims data is due for the week ended October 31. In addition, there will be some Fed speeches on Thursday. Meanwhile, all eyes will turn towards the Non-Farm Payrolls numbers on Friday. Analysts forecast 65K new jobs added. The GBP/USD currency pair is trading at 1.3465. On the daily time frame, the pair shows a bullish near-term bias as it stays above the latest simple moving average at 1.3368 and above the previous retracement break of the downward trend line resistance at 1.3384. At the same time, the pair trades above the prior bearish breakout level at 1.3239, which is now a demand level. In addition, the Relative Strength Index (14) stands at 63, confirming solid but non-extreme buying momentum. On the support side, the near-term support is at 1.3465. Further support is the previous retracement breakout level at 1.3384 and the group of SMAs at 1.3368. Deeper levels of demand include the older retracement breakout level at 1.3239. Now, moving toward resistance barriers, the first barrier comes from the retracement breakout level at 1.3676, while the higher barrier includes the retracement breakout level at 1.3849.
