- GBP/USD witnessed a sharp intraday pullback after hitting fresh three-month tops.
- Bulls showed resilience below 100-DMA and found some support near 23.6% Fibo.
- A sustained break below the 1.2600 mark needed to confirm any further weakness.
The GBP/USD pair stalled its recent strong rally to three-month tops and witnessed a dramatic turnaround on Tuesday. The sharp intraday fall dragged the pair below the overnight swing low, albeit bulls showed some resilience below 100-hour SMA.
The pair managed to find some support ahead of the 1.2600 round-figure mark, near the 23.6% Fibonacci level of the 1.2163-1.2756 positive move. This might now act as a key pivotal point for short-term traders and help determine the pair’s near-term trajectory.
Meanwhile, technical indicators on the daily chart have eased from slightly overbought conditions and maintained their bullish bias on the 4-hourly charts. The set-up supports prospects for the emergence of some dip-buying and resumption of the recent bullish trend.
That said, any meaningful move up might now confront resistance near the 1.2700 level, above which the pair is likely to aim to retest the daily swing high, around the 1.2755 region. Some follow-through buying should pave the way for a move towards reclaiming the 1.2800 mark.
Conversely, a sustained break below the 23.6% Fibo. level (1.2600 mark) should prompt some aggressive technical selling. The pair might then accelerate the slide further towards 38.2% Fibo. level, around the 1.2525 region, en-route the key 1.2500 psychological mark.
GBP/USD 1-hourly chart
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Techical levels to watch
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