GBP/USD Daily Forecast – Test Of Resistance At 1.3780

GBP/USD managed to get above the resistance at 1.3745 and is testing the next resistance at 1.3780.
British Pound Moves Higher Against U.S. Dollar
GBP/USD is currently testing the resistance at 1.3780 while the U.S. dollar is under pressure against a broad basket of currencies.
The U.S. Dollar Index managed to settle below the support at the 92 level and is trying to settle below the next support level which is located at the 50 EMA at 91.80. In case this attempt is successful, the U.S. Dollar Index will move towards 91.50 which will be bullish for GBP/USD.

Yesterday, the U.S. reported that Inflation Rate increased by 2.6% year-over-year in March compared to analyst consensus which called for growth of 2.5%. Core Inflation Rate grew by 1.6%. While inflation exceeded analyst expectations, Treasury yields moved lower which was bearish for the American currency.

Today, foreign exchange market traders will continue to monitor the developments in U.S. government bond markets. The yield of 10-year Treasuries managed to get below the 20 EMA at 1.635% and is trying to get below the recent lows near 1.61%. If this attempt is successful, it will gain additional downside momentum which will be bullish for GBP/USD.
Technical Analysis
GBP/USD managed to settle above the resistance at 1.3745 and is testing the next resistance level which is located near the 20 EMA at 1.3780. In case GBP/USD settles above this level, it will head towards the next resistance at the 50 EMA at 1.3800.

A move above the 50 EMA will push GBP/USD towards the resistance at 1.3835. If GBP/USD gets above the resistance at 1.3835, it will move towrds the next resistance at 1.3865.

On the support side, the previous resistance at 1.3745 will serve as the first support level for GBP/USD. If GBP/USD declines below this level, it will move towards the next support at 1.3710. This support level has been tested during yesterday’s trading session and proved its strength.

In case GBP/USD moves below the support at 1.3710, it will head towards the next support level which is located near the recent lows at 1.3665.