GBP/USD Price Analysis: Challenges critical support near 1.3630 after 200-DMA caves in

GBP/USD extends the rout amid looming Delta covid variant fears.
The cable eyes a daily closing below the key daily support line.
Monday’s closing below 200-DMA, bearish RSI keep sellers hopeful.

Dhwani Mehta FXStreet

GBP/USD bears remain relentless, extending losses for the fourth straight day on Tuesday, as the technical setup continues to flag further downside risks.

With Brexit headlines in the background, the main cause for concern for the GBP bulls remains the spiking cases of the Delta covid variant in the UK, as the Kingdom removed most of the social curbs on Monday.

Concerns over escalating covid cases in the UK amid the reopening prompted GBP/USD to breach the horizontal (orange) trendline support at 1.3633 on the daily sticks.

The bears await a daily closing basis below that level to confirm an extension of the latest downtrend, which could open floors towards the February lows of 1.3567.

Ahead of that support, the 1.3600 round number could test the bullish commitments.

The Relative Strength Index (RSI) edges lower but sits outside the oversold region, suggesting that there is some scope left for further downside.

Meanwhile, Monday’s close below the 200-Daily Moving Average (DMA), now at 1.3702, adds credence to the negative bias.

GBP/USD daily chart

Alternatively, if the abovementioned key trendline support holds up, a rebound towards the upward-sloping 200-DMA remains well on the cards.

The next stop for the bulls could be then seen at the July 19 high of 1.3677.

GBP/USD additional levels to watch

GBP/USD

Overview
Today last price	1.3641
Today Daily Change	-0.0032
Today Daily Change %	-0.23
Today daily open	1.3676

Trends
Daily SMA20	1.3841
Daily SMA50	1.4003
Daily SMA100	1.3933
Daily SMA200	1.3699

Levels
Previous Daily High	1.3777
Previous Daily Low	1.3654
Previous Weekly High	1.391
Previous Weekly Low	1.3761
Previous Monthly High	1.4249
Previous Monthly Low	1.3787
Daily Fibonacci 38.2%	1.3701
Daily Fibonacci 61.8%	1.373
Daily Pivot Point S1	1.3628
Daily Pivot Point S2	1.358
Daily Pivot Point S3	1.3505
Daily Pivot Point R1	1.375
Daily Pivot Point R2	1.3825
Daily Pivot Point R3	1.3873

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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