GBP/USD Price Analysis: Bears flirt with fortnight-old support below 1.2300
- GBP/USD stays defensive after reversing from 21-day EMA.
- Impending bull cross on MACD, hesitance in breaking the support line tease buyers.
- Bears need validation from 1.2160 before targeting the yearly low.
GBP/USD struggles for clear directions as it seesaws around two-week-long support surrounding 1.2260 heading into Tuesday’s London open.
The cable pair portrayed a Doji candlestick the previous day while reversing from the 21-day EMA, which in turn suggested a reversal of the last week’s rebound.
However, a looming bullish signal on the MACD joins a fortnight-old support line to challenge the pair bears.
Even if the quote drops below 1.2260 immediate support, multiple levels surrounding 1.2180-60 marked since June 16 could challenge the pair’s further weakness.
In a case where the GBP/USD bears manage to conquer the 1.2160 support, they can rush towards the yearly bottom near 1.1930-35, also the lowest levels since March 2020.
Meanwhile, recovery remains elusive until the Cable pair remains below the 21-day EMA level surrounding 1.2330.
Should the quote rises past 1.2330, the 61.8% Fibonacci retracement of the May-June fall and a downward sloping trend line from late May, respectively around 1.2390 and 1.2470, will gain the market’s attention.
Overall, GBP/USD remains on the bear’s radar but short-term corrections can’t be ruled out.
GBP/USD: Daily chart
Trend: Corrective pullback expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
