GBP/USD Price Forecast: Sustenance above 20-day EMA backs further upside above 1.3400
The GBP/USD pair trades almost flat at around 1.3355 during the European trading session on Wednesday. The Cable consolidates as investors await the Federal Open Market Committee (FOMC) minutes of the June policy meeting, which will be published at 18:00 GMT.
At press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally lower to near 101.05.
Investors will closely read the FOMC Minutes to gauge possible reasons that led officials to abandon forward guidance on the monetary policy outlook. In the policy meeting, the Fed decided to leave interest rates unchanged in the range of 3.50%-3.75%, citing upside inflation risks, and 9 out of 19 policymakers favored an interest rate hike by the year-end.
Meanwhile, the British Pound (GBP) struggles for direction as investors seek fresh cues regarding the United Kingdom’s (UK) fiscal policy outlook under new leadership. However, newly elected Member of Parliament and Mayor of Greater Manchester, Andy Burnham, the front-runner for UK leadership after Prime Minister (PM) Keir Starmer’s resignation, has already stated that he will continue Labour’s manifesto.
GBP/USD technical analysis
GBP/USD trades calmly near 1.3355, holding a mildly bullish bias as it remains above the 20-day exponential moving average (EMA) at 1.3321.
The bounce from the recent 1.32 area and the pair’s ability to stay supported by the short-term EMA hint at a tentative recovery phase, while the Relative Strength Index (RSI) at 52.8 shows modest positive momentum without entering overbought territory.
On the topside, the next significant barrier is the downward resistance trend line, with its break level around 1.3500. Looking down, the immediate support is reinforced by the 20-day EMA at 1.3321, and a daily close back below this level would weaken the current constructive tone and force the pair to revisit the June 24 low at around 1.3140.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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