Gbpusd Trades On Cautious Mood

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Gbpusd Trades On Cautious Mood

Gbp/Usd Trades Above 1.3050 On Cautious Sentiment

GBP/USD is trading above the 1.3050 handle with a slight bullish bias. It seems that the Cable is struggling to build up on top of the modest gains from Friday.

Amidst all of this, the US Dollar has managed to show sustained strength due to the concerns related to China's economy. On top of that, the heightened geopolitical risks are also a major factor which is keeping the GBP/USD under check.

Gbp/Usd H4 Charts Shows 40+ Reading

The RSI (14) on the GBP/USD chart (H4) shows that it is above the 40 level. That's a sign that the sellers are still hesitant and are not convinced that the GBP/USD will go down.

On the way up, the nearest resistance is at 1.3100, followed by the next one near 1.3170. That's also the same level where the 61.8% fib retracement is located.

As for the downside, the first support for GBP/USD is at 1.3050, which is also an important static level. Below that, the next round level is at 1.3000, followed by 1.2940.

Overall, GBP/USD is still positive based on Friday's gains and could move higher towards 1.3100. If that happens, the 1.3100 level will become a support and allow the Cable to target the next levels.

If we look back, the GBP/USD touched 1.3000 on Thursday but has since moved higher and is now above 1.3050 on Monday. That's a sign of the GBP's resilience despite the broader US Dollar strength.

Meanwhile, the UK's ONS released the GDP data, which showed a 0.2% expansion on a m/m basis in August. This was in line with the forecasts and helped the GBP/USD to gain some ground on Friday.

Also, the Manufacturing Production as well as the Industrial Production jumped up by 1.1% and 0.5%, respectively. This reading has also helped the GBP to remain strong against its peers. The bottom line is that GB is holding its own against the US Dollar but is still in familiar trading range.

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