GBP/USD Price Analysis: Climbs back above 1.2300 mark, fresh session tops
|- GBP/USD finds decent support ahead of mid-1.2200s, monthly lows set on Monday.
- Any subsequent move up is more likely to remain capped near the 1.2355-60 barrier.
The GBP/USD pair managed to rebound around 55-60 pips from daily lows and jumped back above the 1.2300 mark, or fresh daily tops in the last hour.
The intraday slide once again managed to find decent support near the 1.2260-50 region, forming a double-bottom on hourly charts. This coupled with the fact that technical indicators on the 1-hourly chart have started gaining positive traction supports prospects for additional intraday gains.
However, oscillators on 4-hourly/daily charts maintained their bearish bias. Moreover, the pair has been trending lower along a downward sloping channel over the past three weeks or so. This, in turn, warrant some caution for bullish traders and before positioning for any further appreciating move.
Hence, any subsequent move up is likely to confront a stiff resistance, rather remained capped near the 1.2355-60 region. The mentioned barrier marks the 61.8% Fibonacci level of the 102076-1.2813 positive move, which is followed by the trend-channel resistance, just ahead of the 1.2400 mark.
A convincing break through the top end of the channel will negate any near-term bearish bias and prompt some short-covering move. The pair might then surpass the 50% Fibo. level, around the 1.2440 region, and aim towards reclaiming the key 1.2500 psychological mark.
On the flip side, the 1.2260-50 region now seems to have emerged as immediate strong support. Failure to defend the said support will reaffirm the bearish outlook and drag the pair to the 1.2200 mark. The downfall could get extended towards trend-channel support, around the 1.2165-60 region.
GBP/USD 4-hourly chart
Technical levels to watch
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