- GBP/USD primed for a technical breakout on the daily chart.
- RSI stays bullish but 50-DMA is a tough nut to crack.
- Brexit stand-off extends, as focus shift to a new US stimulus aid.
With the stand-off between the European Union (EU) and the UK extending on a Brexit trade deal, GBP/USD is lacking the impetus to take on the upside above the 1.30 level.
However, the persistent downbeat mood around the US dollar, in light of the renewed optimism over a likely US fiscal stimulus deal, continues to exert upward pressure on the cable.
From a short-term technical perspective, the spot has failed to gain acceptance above the 50-daily moving average (DMA), now at 1.3012, for six straight sessions.
Therefore, daily closing above the 50-DMA barrier could provide the much-needed push to the bulls while also yielding a symmetrical triangle breakout on the daily sticks.
The next resistance is placed around 1.3080 levels, the October high, before the buyers eye a break above 1.3100.
The 14-day Relative Strength Index (RSI) remains in the bullish area, supporting the case for the additional upside.
Alternatively, holding onto a strong support area around 1.2905 is critical. That level is the confluence of the 21-DMA and rising trendline support.
Further south, the upward-sloping 100-DMA at 1.2850 could be tested if the latter gives way.
GBP/USD: Daily chart
GBP/USD: Additional levels
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