Skip to content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View more
GBP/USD Technical Analysis: British Pound Trend Reversal in Play

GBP/USD Technical Analysis: British Pound Trend Reversal in Play

Ilya Spivak, Head Strategist, APAC


  • British Pound rejected downward after retesting former support level
  • Chart setup hints long-term decline resuming after 4-month recovery
  • Retail trader sentiment studies bolster the case for a bearish scenario

The British Pound recoiled from support-turned-resistance set from early November, dropping back toward its monthly low against the US Dollarat 1.2872. A break below that confirmed on a daily closing basis opens the door for a test of the 1.2763-84 inflection area.

The decline keeps alive the downtrend in play since mid-December 2019 and sustains the bearish implications of a mid-January break through four-month rising trend support. That breach suggested that a corrective recovery had run its course, setting the stage for resumption of the long-term decline from 2007 peaks.

British Pound vs US Dollar price chart - daily

GBP/USD daily chart created with TradingView

A daily close above falling trend resistance from December’s spike high – now squarely at the 1.31 figure – is probably a prerequisite for neutralizing near-term selling pressure. That would probably clear the way for another challenge of multi-year resistance. Its outer layer is now at 1.3555.


Chart of British Pound vs US Dollar exchange rate, retail trader sentiment

Retail trader data shows 69.04% of traders are net-long, with the long-to-short ratio at 2.23 to 1. The number of traders net-long is 7.63% higher than yesterday and 4.26% lower compared with last week.The number of traders net-short is 20.11% lower than yesterday and 15.54% lower from one week prior.

IG Client Sentiment (IGCS) is typically used as a contrarian indicator, traders being net-long suggests GBP/USD may continue to fall.Traders are further net-long than yesterday and last week, which implies a stronger GBP/USD-bearish sentiment trading bias.

See the full IGCS sentiment report here.


--- Written by Ilya Spivak, Currency Strategist for

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.