GBP/USD outlook: Bears pressure 1.20 support ahead of US CPI data

Slobodan Drvenica Windsor Brokers

GBP/USD

Cable dips further in early Monday’s trading, remaining at the back foot, following Friday’s 0.56% fall.

Fresh weakness retraced over 61.8% of last week’s 1.1960/1.2193 recovery leg, which was strongly rejected last Thursday and left a bull-trap above 55DMA.

Near-term structure is negative, as daily studies show strong bearish momentum and a multiple bear-crosses of 10;20;30;55 DMA’s.

Bears pressure psychological 1.20 support, where last week’s action faced strong headwinds and was rejected.

Violation of 1.20 level would risk test of key supports at 1.1960 (Feb 7 spike low and 1.1942 (200DMA), break of which would spark an acceleration towards next key supports at 1.1841/1.1796 (Jan 6 trough/daily cloud base).

Broken Fibo support at 1.2073 (61.8%) now acts as resistance and should ideally cap upticks to keep fresh bears intact.

Res: 1.2073; 1.2100; 1.2144; 1.2179.
Sup: 1.2000; 1.1942; 1.1900; 1.1841.

Interested in GBP/USD technicals? Check out the key levels

1. R3 1.2205
2. R2 1.2172
3. R1 1.2113
PP 1.208
1. S1 1.2021
2. S2 1.1988
3. S3 1.1929

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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