Can GBP/USD 'Fly' Again After Reaching a 7 -Week High?

 Remaining an excellent week for the close of 2021 trading, the Pound managed to perform better against the slightly gloomy US dollar.

It can be seen that the price movement on the chart of the GBP/USD currency pair over the past week saw the price remain at its latest high until the 2021 curtain anchored last Friday.

The high reached at 1.35500 during last Friday’s surge recorded the highest level for a 7 -week trading period.

Economic data for the manufacturing and services sectors in the UK will be the focus this week which is expected to also influence the movement of the Pound.

Investors are optimistic about the long -term movement for the Pound after the central bank of England at its latest policy meeting has started raising interest rates indicating a willingness to move into a phase of policy tightening.

However, there will be resistance for the Pound as the US dollar is also projected to strengthen in 2022 after the Federal Reserve (Fed) announced measures to accelerate the reduction of bond purchases (tapering) and expectations for a more immediate interest rate hike.

Continuing on the opening trade of 2022, the price on the GBP/USD chart shows a decline back to the focus level of 1.35000 which is seen to be the support level for the price to resume the surge.

The Moving Average 50 (MA50) support level on the 1 -hour time frame was also tested around the 1.35000 zone as of trading in the Asian session.

If these levels fail to be broken, the bullish pattern is expected to continue for the price to head to the next high at 1.35700.

For lower declines, the focus zone at 1.34000 will be tested before the RBS (resistance become support) zone of 1.33600 will signal further price movement.

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