GBP/USD Price Analysis: Attempts a breakout of Falling Channel above 1.2100
|- The Cable has attempted a breakout of the Falling Channel amid an upbeat market mood.
- A decline in US PCE Index has trimmed the US Dollar Index’s appeal.
- The RSI (14) is aiming to shift its trading range to the 60.00-80.00 area.
The GBP/USD pair has turned sideways around 1.2080 after a drop from the round-level resistance around 1.2100 in the Asian session. The Cable has corrected marginally after failing to extend gains above 1.2100. The risk profile is cheerful, therefore, the upside bias has not vanished yet.
Meanwhile, the US Dollar Index (DXY) is struggling to regain ground after a sheer drop at open. The USD Index is hovering around 103.75 and is expected to remain on tenterhooks. The return on US 10-year Treasury bonds has dropped to near 3.73%.
The cable has attempted a breakout of the Falling Channel chart pattern formed on an hourly scale. The upper portion of the chart pattern is plotted from December 20 high around 1.2223 while the lower portion is placed from December 20 low at 1.2085. The responsive buying action in the Pound Sterling has pushed the Cable above the 20-and 50-period Exponential Moving Averages (EMAs) at 1.2068 and 1.2072 respectively.
Also, the Relative Strength Index (RSI) (14) is aiming to shift its trading range in the 60.00-80.00 bullish segment to strengthen Pound Sterling.
For a decisive upside move, the Pound Sterling bulls need to push the Cable above Tuesday’s high at 1.2103, which will drive the asset toward December 22 high at 1.2147 followed by December 20 high around 1.2223.
On the contrary, a break down below Friday’s low at 1.2019 will drag the Cable below the psychological support of 1.2000 to November 29 low at 1.1946. A slippage below 1.1946 will extend the downside in the Cable towards November 30 low around 1.1900.
GBP/USD hourly chart
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