FX.co ★ GBP/USD Hot Forecast on 10 January

GBP/USD failed to break above 1.3600 on Monday and started to decline toward 1.3550 during the European trading hours. The risk-averse market environment and renewed dollar strength seem to be weighing on the pair as investors eye US T-bond yields.

The Relative Strength Index (RSI) indicator on the four-hour chart is closing in on 70, confirming the view that the pair could make a technical correction before the next leg higher.

1.3600 (psychological level, static level, middle-line of the ascending regression channel) aligns as key resistance and buyers could show interest in the pair if that level turns into support. 1.3635 (static level) and 1.3680 (static level) could be seen as the next targets.

On the downside, supports are located at 1.3580 (lower-line of the ascending regression channel), 1.3560 (20-period SMA) and 1.3530 (50-period SMA).