GBPUSD Technical Analysis
- Triangle breakout on the four-hour chart nears.
- Daily chart signals a re-test of the recent low.
We have recently released our Q4 Trading Forecasts for a wide range of Currencies and Commodities, including GBPUSD with our fundamental and medium-term term technical outlook.
GBPUSD – Short-term Breakout Nears
GBPUSD is currently rangebound and stuck within a triangle, pointing to a breakout in the short-term, and the downside looks more likely in the current environment. The pair are currently trading above the 20- and 50-day moving average, but any upside momentum is going to find resistance around 1.2800 – 1.2820. Sterling bulls may point to the recent higher lows being made as a sign of strength but a break below 1.2730 would negate this and leave the pair vulnerable to further falls with the recent multi-month low at 1.2658 the first target.
GBPUSD Four-Hour Price Chart December 7, 2018
![](https://a.c-dn.net/b/18hdHz/Sterling-Remains-Weak_body_Picture_1.png)
The daily GBPUSD chart paints a slightly different picture with lower highs dominating. The pair also trade below all three moving averages, with the 20 and 50-day mas providing resistance all the way back up to 1.2822. A break and close below the October 30 low at 1.2694 leaves 1.2658 vulnerable for a re-test.
GBPUSD Daily Price Chart December 7, 2018
![](https://a.c-dn.net/b/0APmUo/Sterling-Remains-Weak_body_Picture_4.png)
While the technical outlook may point to lower prices, the IG Retail Sentiment Indicator is suggesting that GBPUSD may move higher. Traders are 63.1% net-long GBPUSD – a bearish contrarian indicator – yet traders are less net-long than yesteday and compared with last week. This suggets that GBPUSD may move higher despite the fact that traders are net-long.
--- Written by Nick Cawley, Analyst
To contact Nick, email him at nicholas.cawley@ig.com
Follow Nick on Twitter @nickcawley1
Other Weekly Technical Forecast:
Australian Dollar Forecast – AUD/USD, AUD/JPY and EUR/AUD Trend Lines Broken