British Pound Outlook, GBP/USD, EUR/GBP, GBP/CHF – TALKING POINTS
- GBP/USD testing critical support: will the floor hold?
- EUR/GBP may experience short-term selling pressure
- GBP/CHF compression could precede key breakouts
GBP/USD recently retreated from resistance at 1.3046 and is now retesting support at 1.2878, just above the lower level of the range-binding downtrend (converging white-dotted lines). If downside price action continues and the pair clears both support levels, it could open the door to retesting the upper layer of the November swing-low range between 1.2769 and 1.2816.
GBP/USD – Daily Chart
GBP/USD chart created using TradingView
EUR/GBP may be on the verge of a near-term decline as it timidly trades just below resistance at 0.8389 (gold-dotted line). If the pair capitulates, EUR/GBP may flirt with the December swing-low at 0.8297. Conversely, if it clears the ceiling, the next crucial barrier will be resistance at 0.8533 where the pair’s gains were capped and subsequently led to an over two percent decline.
EUR/GBP – Daily Chart
EUR/GBP chart created using TradingView
GBP/CHF PRICE CHART
Since December, GBP/CHF has been trading in a downward-sloping range, but the ability of these parameters to contain the pair’s price action may soon expire. These potential support and resistance barriers will be tested as the pair continues to be compressed by the descending ceiling and an enduring floor at 1.2540.
If GBP/CHF capitulates, the pair will then test the durability of the lower tier of the downward-sloping range. Conversely, if GBP/CHF breaks above the upper layer, the next obstacle will be the inward portion of the 1.2812-1.2854 resistance zone.
GBP/CHF – Daily Chart
GBP/CHF chart created using TradingView
BRITISH POUND TRADING RESOURCES
— Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com
To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter