GBP/USD Price Prediction: Pound Eyes 1.36 After Bullish Rebound and Key U.S. Data Ahead
The pound is back up against the dollar after a big bounce that took GBP/USD above 1.3520. The move was on the back of a bullish...
Quick overview
- The pound has rebounded against the dollar, with GBP/USD surpassing 1.3520 due to bullish market sentiment.
- Key resistance is at 1.3545, and a close above this level could signal a bullish reversal with higher targets.
- Economic events this week, including US durable goods orders and GDP data, will influence the pair's direction.
- Traders are advised to wait for a close above 1.3545 to go long, with potential upside targets at 1.3595 and 1.3647.
The pound is back up against the dollar after a big bounce that took GBP/USD above 1.3520. The move was on the back of a bullish engulfing candle on the 2 hour chart, a classic sign of conviction buying. Price has hit the descending trendline that has capped rallies since early August and this level is now the key battleground for the next move.
Momentum indicators agree. The 50 period SMA at 1.3470 is now support, the RSI is at 68, flirting with overbought but no bearish divergence and the MACD is bullish with a widening histogram.
GBP/USD Levels to Watch
The test is at 1.3545 where the trendline resistance converges. A close above this level would be a bullish reversal and could open up higher targets.
- Resistance levels: 1.3545, 1.3595, 1.3647
- Support levels: 1.3480, 1.3440, 1.3390
If price fails to clear resistance it could trigger profit taking and send the pair back to 1.3480 or 1.3440 where buyers have stepped in before. Either way, expect volatility to increase as price action narrows into this zone.
Economic Events to Watch
This week’s US calendar will determine if GBP/USD can continue to rally or stall. Tuesday is durable goods orders and consumer confidence, Thursday is Preliminary GDP (3.1%) and jobless claims and Friday is Core PCE (Fed’s preferred inflation gauge).
For the pound Monday is a UK bank holiday so liquidity will be light early in the week but attention will quickly turn to if sterling can capitalise on dollar weakness. Traders will also be watching European CPI for broader risk sentiment cues.
GBP/USD Trade Setup and Outlook
For beginners, the trade is simple: wait for a close above 1.3545 and go long. A stop below 1.3480 limits risk and allows for volatility. Upside targets are 1.3595 and 1.3647 and more if US data disappoints and dollar weakness continues.
If buyers hold on, this could be the catalyst for sterling to challenge 1.37 in the coming weeks. With the technicals in place and macro events on the horizon, GBP/USD is ready to make its next big move—perhaps the start of a bigger bull run for the pound.
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