GBP/USD Price Analysis: Sellers enjoy downside below 50-day SMA at 1.3800
- GBP/USD remains muted in the initial Asian trading hours on Wednesday.
- More downside for pair if price breaks the ascending trendline near 1.3780.
- Momentum oscillator holds onto the oversold zone with a neutral stance.
GBP/USD prints minor losses on Wednesday in the Asian session. After falling nearly 90 pips in the overnight session, from the highs of 1.3856, the pair consolidates losses near the lower levels.
At the time of writing, the GBP/USD pair is trading at 1.3782, down 0.02% for the day.
GBP/USD daily chart
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On the daily chart, GBP/USD has recovered from the low made on August 20 at 1.3602 to touch the high at around 1.3891 on September 3.
The formation of two consecutive red candles suggests bears are in full swing despite the hawkish comments from the Bank of England (BOE) policymaker Michael Saunders. He said the UK does not need as much stimulus as before.
Technically speaking, If price breaks the session’s low, it could move lower toward the 1.3750 and the 1.3700 horizontal support levels.
The Moving Average Convergence Divergence (MACD) indicator still points at the underlying bearish sentiment. Any downtick in the MACD could bring more selling opportunities.
That said, GBP/USD bears would like to test the 1.3650 horizontal support level.
Alternatively, if price moves higher, GBP/USD bulls would first encounter with 50-day Simple Moving Average (SMA) at 1.3805.
On the successful test of the above level, the market participants will encourage to touch the 1.3850 horizontal resistance level and then would attempt to take out the high made on September 3 at 1.3891.
GBP/USD additional levels
Author
Rekha Chauhan
Independent Analyst
Rekha Chauhan has been working as a content writer and research analyst in the forex and equity market domain for over two years.
