FXStreet: pound continues its upward movement

09 December 2022 77
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Source: FXStreet

Author: Sagar Dua

Article: Original article

Publication date: Friday, December 9, 2022


The GBP/USD pair is approaching the 1.2300 level, demonstrating growth for the third day in a row. The pound benefits from a weaker dollar and Treasury yields amid growing concerns about possible recession in the U.S.


A combination of factors is pushing the dollar closer to a multi-month low, which was reached earlier this week. This might be viewed as a tailwind for the pound. An optimism about easing of COVID restrictions in China is still driving a recovery of global sentiments. Besides that, uncertainty surrounding the further path of interest rate hiking by the Federal Reserve is also a burden for the dollar.


From the technical point of view, the GBP/USD pair showed stability around the important 200-Day SMA, and its further upward movement favors bullish traders. Recent price movement went along the uptrend channel lasting since late September, which indicates an established short-term positive trend.


Moreover, oscillators on the daily chart are still far from an overbought zone, thus supporting prospects of further short-term upward movement. So, the next target above 1.2300 is aimed at another testing of the trend channel’s resistance, which is now near a round figure of 1.2400.

 

Forecast: the GBP/USD pair’s growth is likely to continue

This content is for informational purposes only and is not intended to be investing advice.

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