GBP/USD Price Analysis: Rejection from key resistance line highlights 1.2150 support confluence
- GBP/USD remains sidelined after rising to the highest level in five months.
- Overbought RSI, two-month-old resistance line challenge further upside.
- Bear need validation from the convergence of 200-DMA, previous resistance line from late June.
GBP/USD treads water around mid-1.2200s after rising to the highest level since late June the previous day. In doing so the Cable pair portrays the market’s cautious mood ahead of the key US employment data while also justifying the price-negative technical signals.
Among them, overbought conditions of the Relative Strength Index (RSI) line, placed at 14, gain major attention as the quote struggles after a two-day uptrend that refreshed the multi-day peak.
Also challenging the GBP/USD bulls is the upward-sloping resistance line from early October, currently around 1.2280.
Just in case a wild move cracks the 1.2280 hurdle, the 1.2300 round figure and the mid-June high near 1.2410 could act as additional upside filters to watch during the quote’s further advances.
On the contrary, pullback remains elusive unless the GBP/USD pair remains beyond 1.2150 level comprising the 200-DMA and the resistance-turned-support line from late June.
Additionally, a convergence of the August month’s high and the weekly bottom also constitutes short-term key support near 1.1900 and may test the bears before giving them control.
Following that, tops marked in September and October, respectively near 1.1735 and 1.1645 will be in focus.
GBP/USD: Daily chart
Trend: Limited downside expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
