In This Article:
Key Insights
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Today, traders will likely focus on the developments in Treasury markets.
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They will also take a look at the Factory Orders report from the U.S.
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A successful test of the resistance at 1.3110 will push GBP/USD towards the next resistance at 1.3140.
British Pound Gains Some Ground Against U.S. Dollar
GBP/USD is currently trying to settle back above the resistance at 1.3110, while the U.S. dollar is gaining some ground against a broad basket of currencies.
The U.S. Dollar Index continues its attempts to get above the resistance level at 98.70. In case the U.S. Dollar Index settles above this level, it will move towards the next resistance at 99, which will be bearish for GBP/USD.
Today, foreign exchange market traders will have a chance to take a look at the Factory Orders report from the U.S. Analysts expect that Factory Orders declined by 0.5% month-over-month in February after growing by 1.4% in January.
Traders will also continue to monitor the developments in U.S. government bond markets. The inverted yield curve has become a reality as the yield of 2-year Treasuries is trying to settle above 2.50%, while the yield of 30-year Treasuries is close to 2.47%.
Typically, an inverted yield curve is a sign of the upcoming recession. In case the yield of 2-year Treasuries settles above 2.50%, it will gain additional upside momentum, which will be bullish for the American currency.
Technical Analysis
GBP/USD managed to get back above the resistance at 1.3110 and is trying to settle above this level. In case this attempt is successful, GBP/USD will get to the test of the next resistance at 1.3140.
A move above the resistance at 1.3140 will push GBP/USD towards the next resistance level, which is located at the 20 EMA at 1.3160. A successful test of the resistance at the 20 EMA will open the way to the test of the resistance at 1.3175. If GBP/USD gets above this level, it will move towards the next resistance at 1.3200.
On the support side, GBP/USD needs to get back below 1.3110 to have a chance to develop downside momentum in the near term. The next support level for GBP/USD is located at 1.3080. In case GBP/USD declines below this level, it will head towards the support at the recent lows at 1.3050.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire