The depreciation situation of the US dollar which is likely to continue in this week’s trading will leave room for European currencies including the Pound to record gains.
In contrast to the Euro, the movement of the Pound last week was somewhat limited to making gains, instead exhibiting a bearish pattern.
Brexit uncertainty over the Northern Ireland issue is seen to put pressure on the Pound this week after UK-focused economic data published last week failed to boost the currency.
On the price chart of the GBP/USD pair, the price has declined from the high of 1.4000 last week after testing the resistance zone to reach the level of 1.38300 in the RBS zone (resistance become support).
After failing to break the Moving Average 50 (MA50) barrier on the 1 -hour time frame of the price movement on the GBP/USD chart until last weekend, the price started trading this week in the Asian session by breaking the MA50 barrier to give an early signal of a trend change.
The price needs to pass the level of 1.39000 or higher for a clearer indication of further price increases.
Rising prices are seen to once again test the 1.4000 resistance after failing last week. Next, the higher altitude target is seen to be at apras 1.41000.
Yet if the Pound fails to withstand the pressure this week, investors are likely to see a lower price fall past the RBS 1.38000 zone.
The lower price decline could lead up to the 1.37000 support zone which was hit by the price in early April trade.
