GBPUSD is pressuring a confluence of resistance on Thursday that could have significant implications in September.
Watch today’s video for the details, including key levels to watch, potential targets in September, and an update on my trade.
GBPUSD has been range-bound since mid-August, and that range has narrowed in recent days. First, let’s discuss the key level that supported GBPUSD this week.
The trend line from the August open intersected with the price on Wednesday at 1.3436. That’s one reason I longed GBPUSD at 1.3455, a trade I shared with VIP members in real-time.
1.3450 is also a key horizontal level from early August, making the region a confluence of support.
As for resistance, 1.3525 is an obvious horizontal level from August 12th. That’s also a confluent level, as the July trend line is intersecting the price at 1.3520 on Thursday.
This 1.3520/30 area is what GBPUSD bulls have to break to open the door to 1.3580. Alternatively, sellers may push the pound lower to partially fill Thursday’s long lower wick near the 1.3450 support level.
The DXY is also nearing a confluence of support on Thursday at 97.70/80. We’ve discussed this area a few times in recent videos. It’s a key horizontal from 2022, and an ascending trend line from the July lows.
We can’t rule out a dollar bounce while above 97.70. It’s a significant support area, and Wednesday’s long upper wick may push the US dollar higher in the near term.
It’s premature to discuss a likely direction following this consolidation, but the GBPUSD imbalances from July may be a clue.
I discussed it in Wednesday’s outlook video, but the early July single prints near 1.3700 could become targets. That said, buyers need to secure a break above 1.3530 and 1.3580 for that to materialize in September.
There’s also a sell-side single print for GBPUSD at 1.3384. The pair came close to the level last week but never reached it, thanks to comments from Trump that sent the dollar crashing.
I remain long GBPUSD from 1.3455. And while I can’t say which direction is more likely in September, those 1.3700 single prints may become a factor, but only on a break above 1.3530 and 1.3580.
