GBP/USD awaits strong resistance near one-year high

GBP/USD continues last week's rebound off the 200-day SMA and the 50.0% Fibonacci retracement level of the up leg from 1.2300 to 1.3045 at 1.2670, but with some weakness today. The intraday bias looks neutral to negative, as the stochastic is still standing above the 80 level but is losing some steam, while the RSI, although above 50, seems to be making its way down. 

If the pair manages to head higher, the one-year high of 1.3045 could serve as a trigger point for steeper bullish action. Further north, cable could run toward the 1.3140 level, a strong barrier from last year.

However, if the pair reverses to the downside, investors could move first at the 23.6% Fibonacci of 1.2870 before meeting the 20- and then the 50-day simple moving averages (SMAs) at 1.2825 and 1.2800 respectively. If the price continues to drop, support could next come somewhere between the uptrend line and the 38.2% Fibonacci of 1.2760.

In the medium-term picture, the bounce off 1.2300 turned the outlook from neutral to bullish. Chances for another bullish move are still rising as the 200-day SMA keeps rising.