GBP/USD Price Analysis: Eases from two-month top ahead of US CPI, bullish potential intact

GBP/USD witnessed modest pullback from an over two-month high touched this Wednesday.
The technical set-up still favours bullish traders and supports prospects for additional gains.
A dip towards the 1.3600 mark could still be seen as buying opportunity and remain limited.

Haresh Menghani FXStreet

The GBP/USD pair retreated a bit from over two-month high touched earlier this Wednesday and was last seen trading near the daily low, around the 1.3625-20 region. The downtick lacked any fundamental catalyst and could be attributed to some repositioning trade ahead of the critical US consumer inflation figures.

From a technical perspective, the overnight sustained strength beyond the 61.8% Fibonacci level of the 1.3834-1.3161 downfall and the 1.3600 mark favours bullish traders. The constructive outlook is reinforced by bullish technical indicators on the daily chart, which are still far from being in the overbought zone.

Hence, some follow-through strength towards testing a downward-sloping trend-line hurdle, currently around the 1.3675-80 region, remains a distinct possibility. The mentioned barrier extends from July 2021 swing high, which if cleared would be seen as a fresh trigger for bulls and pave the way for additional gains.

The GBP/USD pair might then climb beyond the 1.3700 mark, towards testing the next relevant resistance near the 1.3735 region. The momentum could further get extended and allow the pair to aim back to reclaim the 1.3800 round-figure mark for the first time since October.

On the flip side, any further decline towards the 1.3600 mark could still be seen as a buying opportunity and remain limited near the 61.8% Fibo. resistance breakpoint, around the 1.3575 region. This is closely followed by the 100-day SMA, around mid-1.3500s, which should now act as a pivotal point for traders.

A convincing break below might prompt some technical selling and drag the pair further towards the 50% Fibo. level, around the 1.3500 psychological mark. Some follow-through selling could pave the way for a slide towards the 1.3460-55 region en-route the 1.3430 area and the 38.2% Fibo. level/50-day SMA confluence near the 1.3400 mark.

GBP/USD daily chart

Technical levels to watch

GBP/USD

Overview
Today last price	1.3626
Today Daily Change	-0.0004
Today Daily Change %	-0.03
Today daily open	1.363

Trends
Daily SMA20	1.3438
Daily SMA50	1.3397
Daily SMA100	1.3554
Daily SMA200	1.3738

Levels
Previous Daily High	1.3633
Previous Daily Low	1.3557
Previous Weekly High	1.3599
Previous Weekly Low	1.3431
Previous Monthly High	1.355
Previous Monthly Low	1.3161
Daily Fibonacci 38.2%	1.3604
Daily Fibonacci 61.8%	1.3586
Daily Pivot Point S1	1.3581
Daily Pivot Point S2	1.3531
Daily Pivot Point S3	1.3505
Daily Pivot Point R1	1.3657
Daily Pivot Point R2	1.3683
Daily Pivot Point R3	1.3732

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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