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Pound Technical Analysis: GBP/USD Set up to Stay Strong

Pound Technical Analysis: GBP/USD Set up to Stay Strong

2020-11-06 16:00:00
Paul Robinson, Strategist
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GBP/USD Technical Outlook: Bullish

  • Bullish outlook for GBP, but not as strong a bias as others
  • New channel structure to watch as a guide
  • Could see a rise towards 13500 with a little time
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Cable strength anticipated to remain

GBP/USD looks poised to rise above 13176, the October high, in the days ahead. The strength out of sterling might not match the strength of other currencies that positioned a bit more strongly (i.e. JPY, CAD, EUR), but a run to a big test of 13500 could be in the works with a little time.

The last time we looked at cable there was a channel it was trading higher in, and while that was slightly broken we have another angle of lines that are creating another channeling structure off the September low. Stay above the lower parallel and the bias will at least remain near-term neutral if not outright bullish.

At this juncture it would take a breach of the lower parallel and drop below the Monday low at 12853 to get things running in reverse towards the September low and 200-day moving average.

Either way it might not be a smooth ride as GBP/USD hasn’t been the ‘friendliest’ pair to trade, but using the aforementioned technical structure may help traders stay on the right side in the days to come.

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---Written by Paul Robinson, Market Analyst

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