Currency pair Pound Dollar GBP/USD completes the trading week near the 1.3589 area. The pair continues to move within the framework of the growth and the formation of the bearish Wolfe Wave pattern. Moving averages indicate a bullish trend. Prices moved up from the area between the signal lines, which indicates pressure from buyers and a potential continuation of the rise in the British Pound against the US Dollar at current levels. At this point, we should expect an attempt to grow and test the resistance area near the level of 1.3675. Further, the rebound and the beginning of the fall in the Pound/Dollar quotes to the area below the level of 1.2325.
GBP/USD Forecast and Weekly Analysis January 18 — 22, 2021
An additional signal in favor of the fall of the British Pound will be a test of the trend resistance line on the relative strength index (RSI). The second signal will be a rebound from the upper border of the “Wolfe Wave” pattern. Cancellation of the option to drop the GBP/USD pair in the current trading week January 18 — 22, 2021 will be a strong growth and a breakdown of the 1.4165 area. This will indicate a breakdown of an important resistance area and continued growth to an area above the level of 1.4525. Confirmation of a fall in the GBP/USD currency will be a breakdown of the support area and closing prices below 1.3165, such a movement will indicate a breakdown of the lower boundary of the “Wolfe Wave” model.
Among the important news from the UK that may affect the Pound/Dollar rate, it is worth highlighting: Bank of England (BoE) Governor Bailey Speech, United Kingdom Retail Sales m/m.
GBP/USD Forecast and Weekly Analysis January 18 — 22, 2021 suggests an attempt to rise and test the resistance level near the 1.3675 area. Where can we expect the currency pair to continue to decline with a target below the 1.2325 area. An additional signal in favor of the fall will be a test of the trend line on the relative strength index (RSI). Cancellation of the option to reduce the pair Pound/Dollar will be a strong growth and a breakdown of the level of 1.4165. In this case, we should expect the pair to continue to grow with a potential target above the level of 1.4525.
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