GBP/USD Price Analysis: Attempts a bounce from a critical daily support line

GBP/USD bounces-off key support near 1.3730, not out of the woods yet.
Daily closing above 200-DMA could offer temporary respite to GBP bulls.
RSI remains in the bearish zone, keeping the downside risks intact.

Dhwani Mehta FXStreet

GBP/USD is struggling to extend its bounce above 1.3750, having hit monthly lows at 1.3726 on Tuesday.

The cable is currently trading at 1.3756, up 0.13% on the day, having rebounded from a critical upward-sloping daily support line at 1.3730. The line connects the previous day’s low and July lows.

In doing so, the pair has stalled its two-day decline, although the risks remain skewed to the downside following a daily closing below the 200- Daily Moving Average (DMA) at 1.3768.

Further, the 14-day Relative Strength Index (RSI) edges higher but remains below the midline, keeping the sellers hopeful.

Adding credence to an impending downside breakout, the 50-DMA is fast approaching the 21-DMA, with a break lower to confirm a bear cross – a bearish technical signal.

A daily closing below the abovementioned key support could trigger a fresh sell-off towards the 1.3700 round number.

Sellers will then aim for the July lows at 1.3672 should the downside pressure accelerate.

GBP/USD: Daily chart

Alternatively, a firm break above the 200-DMA is needed for a temporary respite to the cable buyers.

The horizontal 21-DMA at 1.3845 could challenge the bullish commitments on the road to recovery.

GBP/USD: Additional levels to consider

GBP/USD

Overview
Today last price	1.3757
Today Daily Change	0.0015
Today Daily Change %	0.11
Today daily open	1.3743

Trends
Daily SMA20	1.385
Daily SMA50	1.3874
Daily SMA100	1.3928
Daily SMA200	1.3784

Levels
Previous Daily High	1.3853
Previous Daily Low	1.3726
Previous Weekly High	1.3894
Previous Weekly Low	1.3791
Previous Monthly High	1.3984
Previous Monthly Low	1.3572
Daily Fibonacci 38.2%	1.3775
Daily Fibonacci 61.8%	1.3804
Daily Pivot Point S1	1.3695
Daily Pivot Point S2	1.3648
Daily Pivot Point S3	1.3569
Daily Pivot Point R1	1.3822
Daily Pivot Point R2	1.39
Daily Pivot Point R3	1.3948

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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