GBP/USD, GBP/JPY Price: British Pound Forecast- Bearish Signals on The Radar
GBP/USD and GBP/JPY charts and analysis
Weakening Sterling Pound
On Friday, GBP/USD rallied to 1.2582 – its highest level in ten weeks. However, this week buyers showed a clear hesitation to push the price even higher. Yesterday, the pair fell below 1.2400 handle. Similar move occurred on GBP/JPY and yesterday, the pair tested 133.00 handle.
This week, the Relative Strength Index (RSI) fell from 60 to 50 on both pairs indicating that uptrend is losing momentum and about to end.
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GBP/USD DAILY PRICE CHART (Aug 20, 2017 – sep 26, 2019) Zoomed out
GBP/USD DAILY PRICE CHART (March 10 – Sep 26, 2019) Zoomed IN
Looking at the daily chart, we notice on Sep 19 GBP/USD rebounded nearby 1.2550 then buyers were unable to rally the price further. Thus, sellers took the initiative and led the price. Yesterday, the pair moved to a lower trading zone 1.2150 – 1.2360.
Therefore, GBPUSD could decline further towards the low end of the zone. That said, the weekly support levels underlined on the chart (zoomed in) should be considered. See the chart to know more about the lower trading zone with the weekly support area and level to keep an eye on if sellers continue to press the price lower.
In turn, any close above the high end of the zone could see GBPUSD trading towards 1.2550. Further close above this level could resume bullish price action towards 1.2785. In that scenario, the weekly resistance levels marked on the chart should be kept in focus.
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GBP/JPY DAILY PRICE CHART (FEB 20, 2017 – SEP 26, 2019) Zoomed out
GBP/JPY DAILY PRICE CHART (May 24 – SEP 26, 2019) Zoomed in
From the daily chart, we notice since Sep 17 GBP/JPY buyers has been failing to push the pair to a higher trading zone. Hence, sellers took over and pressed the price lower. Yesterday, the price declined to a lower trading zone 130.90 – 133.40.
Thus, GBPJPY may be on its way for a test of the low end of the zone contingent on clearing the weekly support level underscored on the chart (zoomed in). Further close below 130.84 could resume bearish price action towards the vicinity of 129.00- 128.80. Although, the weekly support levels underlined on the chart should be watched closely.
On the other hand, any close above the high end of the zone could push GBPJPY towards 135.55. Nonetheless, the daily and weekly resistance levels marked on the chart should be watched along the way.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.