GBP/USD Price Analysis: Drops below 200-DMA, at cross-roads to resume downtrend

GBP/USD declines 0.36% from its daily peak, under pressure from indications of rising US inflation.
The pair struggles above the 200-day moving average at 1.2564, hinting at potential further declines.
Support levels are seen at: November 14, 2023, high of 1.2506; breaching this could lead to further support tests at 1.2448 and the year-to-date low of 1.2299.
A recovery above the 200-DMA could reignite bullish momentum, aiming for 1.2600, with additional resistance at the 50-DMA and 100-DMA at 1.2619 and 1.2645.

Christian Borjon Valencia FXStreet

The Pound Sterling reverses its course against the US Dollar, after extending its gains past the 200-day moving average (DMA). However, data from the United States (US), showing that inflation could be picking up, as shown by the Employment Cost Index (ECI), bolstered the Greenback. Therefore, the GBP/USD trades at 1.2517 down by some 0.36%, after hitting a daily high of 1.2563.

GBP/USD Price Analysis: Technical outlook

The GBP/USD is neutral biased, though failure to cling above the 200-DMA at 1.2564 might open the door for a pullback, with traders eyeing a test of the November 14, 2023, high at 1.2506. In the event of a drop below that level, further downside is seen at the April 26 intermediate support at 1.2448, before the major plunges to the year-to-date (YTD) low of 1.2299.

On the other hand, if the pair edges above the 200-DMA that would pave the way for testing 1.2600. Once surpassed, key resistance levels emerge. The 50-DMA is up next at 1.2619, followed by the 100-DMA at 1.2645. Subsequent gains are seen above those levels, exacerbating a rally toward 1.2700.

GBP/USD Price Action – Daily Chart

GBP/USD

Overview
Today last price	1.2519
Today Daily Change	-0.0043
Today Daily Change %	-0.34
Today daily open	1.2562

Trends
Daily SMA20	1.2518
Daily SMA50	1.2623
Daily SMA100	1.265
Daily SMA200	1.2556

Levels
Previous Daily High	1.257
Previous Daily Low	1.2477
Previous Weekly High	1.2542
Previous Weekly Low	1.23
Previous Monthly High	1.2894
Previous Monthly Low	1.2575
Daily Fibonacci 38.2%	1.2534
Daily Fibonacci 61.8%	1.2512
Daily Pivot Point S1	1.2503
Daily Pivot Point S2	1.2444
Daily Pivot Point S3	1.241
Daily Pivot Point R1	1.2596
Daily Pivot Point R2	1.2629
Daily Pivot Point R3	1.2688

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

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