GBP/USD Price Analysis: Recaptures 50-DMA on the road to recovery

GBP/USD extends rebound into the second straight day.
The US dollar corrects further, undermined by the upbeat mood.
GBP bulls jump back above 50-DMA, as the focus shifts to the BOE decision.

Dhwani Mehta FXStreet

GBP/USD is looking to build onto Friday’s rebound from five-week lows of 1.3357 reached last Thursday, as the overall upbeat market mood favors the high-beta currency in the pound.

Collaborating with the upswing in the cable, the US dollar eases from one-and-a-half-year highs against its main peers, as investors take profits off the table ahead of the BOE interest rate decision and US payrolls.

The BOE is likely to deliver a second 25-bps post-pandemic rate hike on Thursday, slightly ahead of the Fed in the tightening cycle.

Apart from the BOE outcome this week, markets also remain focussed on the Brexit Freedoms Bill passage and the UK’s political scenario for fresh trading opportunities in GBP/USD.

Looking at GBP/USD’s daily chart, the pair is recovering ground above the horizontal 50-Daily Moving Average (DMA) at 1.3419.

The 14-day Relative Strength Index (RSI) is recovering from lower levels while below the midline, aiding the upturn in the spot.

However, for the rebound to gather steam, the major needs to find acceptance above the January 27 highs of 1.3468.

The next upside target is aligned at the 1.3500 round level.

GBP/USD: Daily chart

Alternatively, if the bulls fail to yield a daily closing above the 50-DMA hurdle, then the downside momentum could resume towards the intraday lows of 1.3387.

Further south, GBP bears will challenge the bullish commitments at the five-week lows.

GBP/USD: Additional technical levels

GBP/USD

Overview
Today last price	1.3434
Today Daily Change	0.0037
Today Daily Change %	0.28
Today daily open	1.3397

Trends
Daily SMA20	1.3561
Daily SMA50	1.3418
Daily SMA100	1.3525
Daily SMA200	1.3721

Levels
Previous Daily High	1.3433
Previous Daily Low	1.3365
Previous Weekly High	1.3566
Previous Weekly Low	1.3358
Previous Monthly High	1.355
Previous Monthly Low	1.3161
Daily Fibonacci 38.2%	1.3407
Daily Fibonacci 61.8%	1.3391
Daily Pivot Point S1	1.3364
Daily Pivot Point S2	1.333
Daily Pivot Point S3	1.3296
Daily Pivot Point R1	1.3432
Daily Pivot Point R2	1.3466
Daily Pivot Point R3	1.3499

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.

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