British Pound Technical Price Outlook: GBP/USD Weekly Trading Levels
- Sterling technical trading level update – Weekly Chart
- GBP/USD dive testing downtrend support- risk for major price flex
- Weekly resistance 1.1414/80 (key), ~ 1.1290s, 1.11 – Support 1.1414/80 (key), ~ 1.1290s, 1.11
The British Pound fell more than 2.2% from the monthly high against the American dollar with GBP/USD again threatening to dive into support at the annual lows. The focus remains on a possible price inflection into this key pivot zone with all eyes now moving to major central bank rate hikes next week from the Fed and BoE. These are the updated targets and invalidation levels that matter on the GBP/USD weekly chart heading into the September open. Review my last Strategy Webinar for an in-depth breakdown of this Sterling technical setup and more.
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British Pound Price Chart – GBP/USD Weekly
Chart Prepared by Michael BoutrosTechnical Strategist; GBP/USD on Tradingview
Notes: In the past month British PoundEvery week Technical Forecast we noted that GBP/USD “broke to fresh annual lows with the annual downtrend intact going into the September open. From a trading point of view, rallies should be limited by the price of 1.1950 IF it goes lower in this stretch with 1.1414/80 representing the next major support zone of interest.” Sterling recorded an intraday low of 1.1405 the following week before rebounding almost 3% from the lows. The pound is under pressure again this week with price again approaching this key support pivot at the 2020/1984 lows at 1.1414/80– looking for a possible price inflection from this zone in the coming days.
A break / close below this threshold would risk large sterling losses with such a scenario exhibiting the highlighted. trend line confluence (currently near ~1.1290s) and the 1.11-handle. At first every week resistance stable at the 2020 close low at 1.1650 with a wider bearish invalidation has now dropped to the 2016 low / annual channel resistance around 1.1950.
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Bottom line: A short-term bounce from key support takes the British pound back into a major technical confluence zone risk for price bending into this threshold. From a trading point of view, look to reduce portions of short exposure / lower protective stops in a stretch to 1.1414/80- rallies should be limited by the monthly high closing at. 1.1678 IF price is actually going down in this stretch. Remember that the FOMC and Bank of England (BoE) interest rate decisions are due next week – stay tuned here. I will publish an updated trading outlook on the near-term Sterling once we get more clarity on the near-term GBP/USD technical trading levels.
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British Pound Trader Sentiment – GBP/USD Price Chart
- Summary of IG Customer Sentiment shows that traders are net long GBP/USD – the ratio stands at +3.45 (77.53% of traders are long) – typically bearish reading
- Long positions are 2.41% lower than yesterday and 6.14% lower than last week
- Short positions are 13.05% higher than yesterday and 10.25% lower than last week
- We usually take a contrary view to crowd sentiment, and the fact that traders are net long suggests that GBP/USD prices will continue to fall. Traders are less net long than yesterday but more net long from last week. The combination of current position and recent changes gives us an additional mixed trading bias of GBP / USD from feeling point of view
of customers is network long
of customers is net short
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— Written by Michael BoutrosTechnical Strategist with DailyFX
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