GBP/USD Price Analysis: Lacks a clear directional bias around mid-1.3500s
- GBP/USD is testing lows after rejection at higher levels.
- The cable remains trapped between two key averages on the 4H chart.
- RSI trades flat at the midline, suggesting indecisiveness for the pair.
Having failed to clear a strong supply zone near 1.3580 recently, GBP/USD has turned south starting out a fresh week, now consolidating near mid-1.3500s.
The renewed Brexit concerns, fuel supply issues and a broad rebound in the US dollar are weighing negatively on the cable, as investors digest the latest China Evergrande story.
Light trading conditions seem to have added to the retreat in the major while a lack of relevant UK and US economic news will leave the pound traders at the mercy of the risk sentiment.
From a near-term technical perspective, the price is keeping its range between the two key moving averages on the four-hour chart.
The upside likely remains capped below the downward-sloping 50-Simple Moving Average (SMA) at 1.3594. Meanwhile, the horizontal 21-SMA at 1.3495 is likely to defend the bullish traders.
The Relative Strength Index (RSI) is trading listlessly at the midline, offering no clear sense of direction for the traders, at the moment.
A sustained move above the range highs is needed to test the 50-SMA resistance, above which the 1.3650 psychological barrier could come into play.
GBP/USD: Four-hour chart
Alternatively, a daily closing below the 21-DMA support could reinforce bearish interests, exposing the downside towards the ten-month lows of 1.3411.
Ahead of that the 1.3500 could challenge the bullish commitments.
GBP/USD: Additional levels to consider
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.
