GBP/USD: forecast for January 18-24
By Kira Iukhtenko
British currency remains under bearish pressure for a third week in a row: the cable plummeted below 1.44 on the past week. We see potential for more downside in the coming days. However, note that the pair is approaching a strong long-term support at 1.4220 which was the low in 2010. Many short positions will be closed at these levels.
The pair is strongly oversold these days: pay attention to the daily RSI index. Disappointing news from the US could trigger a strong correction to the upside. Resistance lies at 1.4450. Break higher could open the way for more growth to 1.48, but it’s too early to forecast in such a long prospect these days. Markets change their mind very fast.
As for the economic calendar, watch the UK Inflation figures on Tuesday. On Wednesday, a block of labor market data will be released and don’t miss the UK retail sales on Friday.