GBP/USD Price Analysis: Green signal for cable as RSI turns bullish
- The Rising Wedge formation is advocating for pound bulls going forward.
- A progressive range shift move by the RSI (14) adds to the upside filters.
- The cable bulls are facing resistance at 200-EMA.
The GBP/USD pair has displayed volatility contraction in the early trade after failing to sustain above its Initial Balance. The cable is oscillating in a range of 1.2514-1.2549 in the Asian session and is expected to trade lackluster as it has failed multiple times while attempting a break above 1.2550 from Tuesday.
A Rising Wedge chart formation on a four-hour scale is underpinning the pound bulls for now. The upper boundary of the above-mentioned chart pattern is placed from 1.2400 while the lower boundary is plotted from March 13 low at 1.2155.
A progressive range shift move by the momentum oscillator, Relative Strength Index (RSI) (14) is displaying a strong upside for the asset. The pair has comfortably shifted into the bullish range of 60.00-80.00, which indicates more upside ahead.
The asset is facing barricades at the 200-period Exponential Moving Average (EMA), which is trading at 1.2600. While an establishment above 50-EMA, which is hovering around 1.2465 confirms short-term bullish momentum.
Should the asset displays a pullback move to near 50-EMA at 1.2465, a responsive buying action will drive the asset towards Monday’s high at 1.2601. An occurrence of the same will further push the asset towards April 25 low at 1.2698.
Alternatively, a slippage below May 19 low at 1.2330 will drag the asset to near March 6 low at 1.2261, followed by March 13 low at 1.2155.
GBP/USD four-hour chart
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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
