Technical Analysis of GBP/USD for December 4, 2020

Technical Analysis of GBP/USD for December 4, 2020

Technical Market Outlook:

The GBP/USD pair has broken above the level of 1.3395 and made a new local high at the level of 1.3498, but was capped at the end of the rally and a Bearish Engulfing candlestick pattern was made at the H4 time frame chart. Nevertheless, this situation is only temporary and there is no indication of the up trend termination, so the next target for bulls is still seen at the level of 1.3512 (swing high from December 2018). The nearest technical support is located at 1.3447, 1.3395 and 1.3264. The strong and positive momentum supports the short-term bullish outlook, so only if the demand zone located between the levels of 1.3264 – 1.3295 is clearly violated, then the outlook will change to bearish.

Weekly Pivot Points:

WR3 – 1.3523

WR2 – 1.3460

WR1 – 1.3387

Weekly Pivot – 1.3326

WS1 – 1.3255

WS2 – 1.3195

WS3 – 1.3124

Trading Recommendations:

The GBP/USD pair is in the down trend on the monthly time frame, but the recent bounce from the low at 1.1411 made in the middle of March 2020 looks very strong and might be a reversal swing. In order to confirm the trend change, the bulls have to break through the technical resistance seen at the level of 1.3518. All the local corrections should be used to enter a buy orders as long as the level of 1.2674 is not broken.

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