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GBP/USD: further upside potential above 1.613

After recapturing the 1.600 level, GBP/USD is forming a second shooting star in a row on the daily chart this morning. The bulls are targeting November’s highs at 1.617 but it looks like the 1.61 level offers strong resistance at the moment, with attempts to break above that area likely to be met with resistance as the fundamental picture for sterling continues to be discouraging, with the UK’s rating review among the most imminent threats.

The market remains well supported by an uptrend line for about a week now and as long as the support base at 1.608 remains intact there is no reason for the bulls to worry, with any pullbacks towards that area likely to be a good buying opportunity.

On to the main topics of today, the Bank of England announcement is expected with all eyes on potential new stimulus measures. Later today, the focus shifts to the other side of the Atlantic with the US jobless claims due for release at 1.30pm (UK time).

Dafni Serdari
Market Analyst

Published: 6 December 2012

You should under no circumstances consider the information and comments provided as an offer or solicitation to invest. This is not investment advice. The information provided is believed to be accurate at the date the information is produced.

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