GBP/USD Price Analysis: Bounces off 10-day SMA post-Powell speech
|- GBP/USD consolidates recent losses near key short-term SMA support.
- Ascending trend line from January 11 adds to the downside filter.
- Powell tried to placate bears but gained little success ahead of US Q4 GDP.
GBP/USD wavers around 1.3700, at 1.3695 now, while trying to keep the latest corrective pullback. In doing so, the quote stays above 10-day SMA, amid strong RSI conditions, during the early Asian trading session on Thursday.
The quote refreshed the 32-month peak the previous day before declining to 1.3659 on broad US dollar strength. While the Fed’s dovish halt favored the greenback’s demand, due to its safe-haven nature, Federal Reserve Chairman Jerome Powell’s cautious optimism seemed to have triggered the latest bounce.
Read: Powell speech: Jury is out on whether there will be economic scarring
However, traders are cautious ahead of the key preliminary readings of the US Q4 GDP, expected 3.9% versus 33.4% prior, up for publishing at 13:30 GMT.
Technically, strong RSI conditions and successful trading beyond 10-day SMA, currently around 1.3665, favors the GBP/USD buyers to challenge the May 2018 high of 1.3772. Though, the recent top near 1.3755-60 offers an extra filter to the north whereas the April 24, 2018 low near 1.3920 can lure the bulls beyond 1.3772.
Alternatively, the pair’s declines below the 10-day SMA level of 1.3665 need to break a confluence of the short-term ascending support line and 21-day SMA, currently around 1.3640-35, to convince GBP/USD sellers. Following that, the monthly low near 1.3450 should gain the market’s attention.
Overall, the GBP/USD prices are in an uptrend backed by strong RSI and weak US dollar.
GBP/USD daily chart
Trend: Bullish
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