GBP/USD Forecast: retains bullish outlook, darting towards 1.35 handle


Even as the US Dollar gained some positive traction on the back of an upwardly revised US GDP print, the GBP/USD pair continued with its Brexit optimism-led strong up-move. The market now seems to have started pricing in further progress on Brexit talks for a trade deal with the EU, with the pair hitting fresh 2-month tops on Thursday and now looking all set to head towards reclaiming the key 1.3500 psychological mark. 

There aren't any major market-moving economic releases due for release from the UK and hence, any fresh Brexit news headlines and the USD price dynamics would remain key determinants of the pair's movement ahead of the US economic docket, featuring the release of usual initial jobless claims, Core PCE price index, personal income/spending data and Chicago PMI.


Technically, the pair retains its bullish bias but with short-term technical indicators now approaching near-term overbought conditions, bulls are more likely to take some breather before the next leg of up-move. Having said that, a clear break through the 1.35 handle might now force positional traders to unwind their bearish bets and accelerate the up-move towards the 1.3580 horizontal resistance ahead of the 1.3600 handle and post-Brexit swing highs resistance near mid-1.3600s.

On the flip side, any profit-taking slide now seems to find immediate support near the 1.3435-30 region, which if broken might prompt further long-unwinding trade and drag the pair back below the 1.3400 handle towards 1.3365-60 support area.

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