GBP/USD Downtrend Move Cracks, Bears at Risk - GBP vs USD Price Outlook
GBP/USD Price Technical Forecast
GBP/USD Price – Indecisive Traders
Last week, Cable declined 1.2954 – its lowest level in three weeks. The market rallied after with some bears seemed to cut back. On Friday, the price closed the weekly candlestick with the third Doji pattern in a row highlighting that market’s indecision is still on.
Alongside that, the Relative Strength Index (RSI) remained flat nearby 50 highlighting weak sellers and weaker buyers.
GBP/USD DAILY PRICE CHART (April 25, 2018 – Jan 22, 2020) Zoomed out
GBP/USD DAILY PRICE CHART (Oct 15 – Jan 22, 2020) Zoomed IN
From the daily chart, we noticed that on Monday Cable rebounded from the low end of current trading zone 1.2965 – 1.3048 reflecting bears hesitation.
On the following day, the market rallied then retreated back to the same trading zone yet closed above the 50-day average generating a bullish signal.
A close above the high end of the zone could entice GBP/USD bulls to lead the price towards 1.3300 contingent on clearing the weekly resistance levels underscored on the chart (zoomed in).
In turn, a close below the high end of the zone could reverse the pair’s course towards the low end of the zone. Further close below this level opens the door for GBPUSD bears to press towards 1.2774. Having said that, the weekly support levels and area marked on the chart should be considered as some traders could join/exit that market around these points.
GBP/USD Four Hour PRICE CHART (DEC 23 – Jan 22, 2020)
Looking at the four-hour chart, we noticed that on Jan 8 GBP/USD started a downtrend move creating lower highs with lower lows. However, the price currently develops a double bottom pattern. Any violation to the neckline located at 1.3119 could cause a rally towards 1.3276.
Thus, a break above 1.3135 could push the price towards 1.3185. That said, the resistance level underlined on the chart should be watched closely. On the other hand, a break below 1.3013 may send GBPUSD towards 1.2965. Nevertheless, the daily support level underscored on the chart should remain in focus.
See the chart to find out more about key levels Cable would encounter in a further bearish /bullish scenario.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.