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GBP/USD probes weekly highs under 1.3400, backs off for now

  • GBP/USD rallied as high as the mid-1.3390s on Wednesday, but has since eased off back to close to 1.3380.
  • The pair is eyeing a test of highs set on Monday at 1.3398, ahead of a test of the psychologically important 1.3400 level.

On Wednesday, GBP/USD fell as low as 1.3310 during the European morning session, but through the European afternoon and US morning ground back towards highs set on Monday of just below 1.3400. As trade settles down for what is likely to be a quiet Thursday Asia session ahead of thin US Thanksgiving holiday trade for the rest of the week, the pair has eased back to around 1.3380.

GBP/USD bulls eye a test of year-to-date highs

If Cable can crack it above 1.3400, there is not much by way of significant areas of resistance ahead of year-to-date highs at 1.3485, a level bulls are likely to gun for in case of a decisive upside break (perhaps spurred by the news of a Brexit deal being reached).

In the bearish scenario, the first area of support is likely to come around 1.3350 in the form of an uptrend linking last Thursday’s, Monday’s and Tuesday’s lows. Beyond that, Wednesday’s low at 1.3304, Tuesday’s low at 1.3293 and Monday’s low at 1.3262 are the next support zones to watch out for.

GBP/USD hourly chart

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