GBP/USD Weekly Forex Forecast – 22nd to 26th Jan 2018
The GBP/USD bullish trend has continued to extend to the upside, reaching new higher grounds. Last week high at 1.3950 remains our key resistance level but a break above will expose the big psychological number 1.4000. A retest of the big round number 1.4000 can produce a reaction lower since the current bullish run seems overextended. On the downside we have as potential support the intraday support level 1.3750, but the more important support only come at 1.3657 previous swing high.
The stochastic indicator is not showing any signs of extreme sentiment in the market as it looks more neutral. The most likely scenario is for the GBP/USD to consolidate its current gains but only after another attempt to break towards 1.4000. The UK economic calendar only has some moderate risk events that can cause some volatility. On Wednesday we have the Unemployment figures which are expected to remain at 4.3% the lowest level since 1975. On Friday the UK GDP figures for the last quarter of 2017 will be released. The consensus is for the UK economy to post a 0.4% economic growth.