GBP/USD Price Analysis: Peaks at five-week high, fails to challenge 1.2700
- GBP/USD climbs past 100-DMA, with buyers gaining traction.
- Buying interest remains strong, as RSI points upwards, yet to become overbought.
- Key resistance lies at 1.2670, which would exacerbate followed by 1.2700.
- Sellers target a close below the 100-DMA to challenge 1.2600.
The Pound Sterling advanced some 0.30% and hit a five-week high of 1.2670 following the release of the US Consumer Price Index (CPI). The data was mostly aligned with estimates, showing a continuation of the disinflation process, which weighed on the Greenback. The GBP/USD trades at 1.2641 at the time of writing.
GBP/USD Price Analysis: Technical outlook
The GBP/USD remains neutral to upward bias and hit a weekly high at 1.2670 following a soft US inflation report. However, the pair has retreated toward the 100-day moving average (DMA) at 1.2632, seen as the next key technical level that, once surpassed, could pave the way for further gains.
The Relative Strength Index (RSI) shows that momentum favors buyers. The RSI aims upward with enough room before portraying overbought conditions.
If buyers reclaim the 100-DMA, the next resistance would be today’s high at 1.2670. A breach of the latter will expose the April 9 high at 1.2709, ahead of rallying to the next supply zone at 1.2803, the March 21 high. Once surpassed, the next stop would be the year-to-date (YTD) high at 1.2894.
Conversely, sellers remain hopeful that the GBP/USD exchange rate could tumble below the 100-DMA and achieve a daily close below that level, to challenge 1.2600. Once cleared, the next stop would be the 50-DMa at 1.2591, followed by the 200-DMA at 1.2539.
GBP/USD Price Action – Daily Chart
Author
Christian Borjon Valencia
FXStreet
Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.
