GBP/USD Price Analysis: 1.2955 caps the immediate bounce from six-week lows
|
- GBP/USD attempts a bounce from six-week lows.
- Rectangle breakdown on 15-minutes chart fuelled the sell-off.
- Rebound to remain capped near a strong hurdle at 1.2955.
GBP/USD is making recovery attempts from fresh six-week lows of 1.2920, although the looming Brexit risks combined with broad dollar strength could keep the bounce limited.
The bulls could also turn cautious ahead of the release of the UK government’s internal market bill due later today.
The bill sets out the British government’s plans to ensure trade between all four home nations remains barrier-free after the Brexit transition period ends on 31 December 2020, per Sky News.
From a technical perspective, the pair charted a rectangle breakdown on the 15-minutes chart over the last hours, with the pattern target at 1.2929 already achieved. The bears, further, extended control and reached six-week lows at 1.2920.
Thereafter, the price staged a quick rebound but the sellers will continue to lurk around 1.2955, the confluence of the pattern support and 21-Simple Moving Average (SMA).
Should the recovery gain momentum above the latter, the next resistance is seen at the downward sloping 50-SMA of 1.2965.
The Relative Strength Index (RSI) on the said time frame has bounced-off the oversold territory, still remains in the bearish region around 38.45.
GBP/USD: 15-minutes chart
GBP/USD: Additional levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.