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InstaForex

August 9, 2021

GBP/USD Is Expected To Show A Bearish Pattern This Week

 The price movement on the chart of the GBP/USD currency pair showed a decline at the end of the week closing the trade to the lowest level of the last week.


The situation was driven by the strengthening of the US dollar after the reading of the US NFP employment data report in July was stronger than expected.


Investors remained cautious for Pound trading as the strengthening momentum failed to be sustained after being supported by hawkish statements by England’s central bank for policy tightening signals.


Last week's horizontal price movement was also seen to have ended the bullish pattern of prices in previous weeks, and this week it is likely that investors will see a bearish pattern with the continued strengthening of the US dollar.




After the weekend price decline on the GBP/USD chart hit the level around 1.38600, the price was seen showing a slight increase at the beginning of the European session on Monday, to test the 1.39000 price zone.


The price is expected to continue the lower decline towards the RBS (resistance become support) zone of 1.38000 if the Pound fails to curb the dominance of the US dollar this week.



The continued lower decline could head back to the focus zone at 1.37000 before to the support zone at the 1.36000 level.


Yet if the price re -exhibits a bullish pattern past the barrier at 1.39000, the resistance zone at 1.40000 remains a target to be tested.


Trading in the previous week also still failed to reach the 1.40000 zone after also being tested in last June's trading.


In addition to US inflation data, investors will also be looking forward to the release of UK Gross Domestic Product (GDP) data for the second quarter which will drive the Pound's movement this week.