GBPUSD after failing to break above the support turned resistance and strong price action 1.3880, adapted to bearish sentiments and fell below our 61.8% fibo retracement level. Our previous analysis published on 17th Sept carried dovish expectations from the cables because of hovering below exponential moving averages 50 and 200 in daily time frame. Currently the pair is strong supported by high supply demand zone at 1.3610, while still having the potential to dive towards 50% fibo retracement level at  1.3530. Exponential moving average 50 in weekly time frame has been also supporting the cables since 13 weeks - with this being the third attempt to break below and adapt to impulsive-higher degree of bearish correction. On a fundamental note, Britain joining the North American free trade deal can boost both US Dollar and British Pound, the idea has been floated by the press. While such a move would make no geographical sense, it could boost UK-US trade and provide sterling a much-needed boost. Otherwise, GBP/USD is at the mercy of greater forces.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

In the case that the  pending interest rates tomorrow declines during the release of the figures, the GBPUSD could look for support in the weekly S2 simple pivot points at 1.3608. Afterwards, the 1.3600 could provide support. Moreover, the rate might be supported by the previous summer low levels that are located in the 1.3605/1.3575 range. On the other hand, a potential recovery from any of the mentioned support levels would face first the 55-hour SMAs resistance, the weekly S1 at 1.3676 and afterwards the 100-hour simple moving average. The montary policy summary would define the next stance for British Pound while standing near strong support zones and also lets not forget what the FED meeting minutes have for us because the fundamentals are strong enough during FOMC to cause high volatility in the entire market. 

GBPUSD

Sep 22 2021