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  • GBP/USD struggled for a firm direction and was seen consolidating the recent gains to YTD tops.
  • The set-up favours bullish traders and supports prospects for an extension of the upward trajectory.

The GBP/USD pair lacked any firm directional bias and seesawed between tepid gains/minor losses, through the early North American session. The pair was last seen trading around mid-1.3300s, nearly unchanged for the day.

Given Friday’s sustained move beyond the 1.3280-85 supply zone, the range-bound price action on the first day of a new week might still be categorized as a consolidation phase. Bullish technical indicators on 4-hourly/daily charts add credence to the constructive outlook.

This, in turn, favours bullish traders and supports prospects for additional gains amid sustained selling around the US dollar. However, RSI (14) on the mentioned chart remains on the verge of breaking into the overbought territory and warrant some caution for bullish traders.

That said, the pair seems poised to build on its recent strong upward trajectory and aim to reclaim the 1.3400 mark. Some follow-through buying will set the stage for a move towards the key 1.3500 psychological mark en-route December 2019 swing highs, around the 1.3515 level.

On the flip side, any meaningful dip will now be seen as an opportunity for bullish traders. This, in turn, should help limit the downside near the 1.3285-80 resistance breakpoint, which is closely followed by support near the 1.3270-65 region.

GBP/USD 1-hourly chart

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Technical levels to watch

 

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