Technical analysis for GBP/USD pair for the week of December 28-31, 2020

Last week, the pound/dollar pair declined, tested the support line of 1.3188 (white bold line) and then moved up, almost reaching the upper fractal of 1.3623 (weekly candle from 12/13/20) – red dotted line. The weekly candle closed at the level of 1.3533, which is just above the historical support level of 1.3511 (blue dotted line). This week, the price will most likely continue to move up.

Trend analysis

This week, the price from the level of 1.3533 (closing of the last weekly candle) will move up to the target of 1.3623 (red dotted line) – upper fractal (weekly candle from 12/13/2020). If this line is tested, the upward movement can continue to the target of 1.36751 – the pullback level of 76.4% (blue dotted line). The final target of the weekly candle is the resistance line of 1.3855 (white thick line).

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Figure 1 (weekly chart)

Comprehensive analysis:

  • Indicator analysis - up
  • Fibonacci levels - up
  • Volumes - up
  • Candlestick analysis - up
  • Trend analysis - up
  • Bollinger lines - up
  • Monthly chart - up

An upward movement can be concluded based on comprehensive analysis.

The overall result of the candlestick calculation on the weekly chart: the price is likely to have an upward trend this week, without the first lower shadow in the weekly white candlestick (Monday - up) and without the second upper shadow (Friday - high).

The first upside target is the upper fractal of 1.3623 (weekly candle from 12/13/2020) – red dotted line. Upon testing this line, the upward movement can continue to the target of 1.36751 – the pullback level of 76.4% (blue dotted line). The final target of the weekly candle is the resistance line of 1.3855 (white thick line).

An alternative scenario: the price from the level of 1.3533 (closing of the last weekly candle) may rise to the target of 1.3623 (red dotted line) – upper fractal (weekly candle from 12/13/20). In case of testing this line, move down to the target of 1.3511 – the historical support level (blue dotted line).

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