Key Highlights
- The British Pound traded higher this week and broke the 1.4000 mark against the US Dollar.
- There is an ascending channel forming with support at 1.3960 on the 4-hours chart of GBP/USD.
- The current market sentiment is positive and the pair is likely to move past 1.4050.
- Today, the UK Claimant Change Count for Dec 2017 will be released, which is forecasted to post 5.4K, down from the last 5.9K.
GBPUSD Technical Analysis
The British Pound is in a major uptrend above the 1.3900 support area against the US Dollar. The GBP/USD pair is holding bullish and eyes UK’s employment report for Dec 2017 to make the next move.
Looking at the 4-hours chart of GBP/USD, there was a sharp rise from the 1.3450 swing low. The pair broke the 1.3600 and 1.3800 resistance levels to gain upside traction.
It touched 1.4003 before starting a downside correction. Sellers were able to push the pair below the 23.6% Fib retracement level of the last wave from the 1.3838 low to 1.4003 high. However, the pair found strong bids on the downside, recovered and moved above the 1.4020 level.
At the moment, it seems like there is an ascending channel forming with support at 1.3960 on the same chart. The channel support at 1.3960 is near the 38.2% Fib retracement level of the last wave from the 1.3838 low to 1.4036 high.
Therefore, the 1.3960 support holds a lot of importance in the near term. As long as the pair is above the 1.3960 and 1.3920 support levels, it remains in an uptrend. Should there be a decline below 1.3900, the pair could test the 1.3800 level.
On the upside, the 1.4000 handle was a monster resistance for buyers. A daily close above the mentioned 1.4000 level suggests more gains going forward. The next major hurdles for GBP/USD are 1.4080 and 1.4120.
Fundamentally, the UK Claimant Change Count for Dec 2017 will be released today. The market is not looking for any major change, which means if the outcome exceeds the forecast, British Pound could gain a lot of bullish traction.
