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  • The bias remains bullish as long as it stays above the ascending trendline.
  • A new higher high activates further growth.
  • Only a valid breakdown below the uptrend line invalidates an upside continuation.

The GBP/USD price dropped a little after reaching 1.2344 yesterday. The pair is trading at 1.2207 at the time of writing. It is struggling to gain back.

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The price hit the daily low at 1.2158 today. However, the bias remains bullish in the short term as the US dollar has not yet triggered a bullish reversal.

Fundamentally, the USD received a helping hand from the US data yesterday. That’s why the currency pair slipped lower. The ISM Services PMI came in at 56.5 points versus 53.5 points expected and 54.4 in the previous reporting period.

In addition, the Factory Orders reported a 1.0% growth versus the 0.7% expected, while Final Services PMI jumped from 46.1 to 46.2 points. On the other hand, the UK Final Services PMI came in at 48.8 points, matching expectations.

Today, the UK Construction PMI came in at 50.4 points below 52.0 expected, while BRC Retail Sales Monitor surged by 4.1%. Later, the US is to release the Trade Balance.

The economic indicator could drop from -73.3B to -80.1 B. Tomorrow, the BoC could also have a big impact on the USD. The Overnight Rate is expected to be increased from 3.75% to 4.25%.

GBP/USD price technical analysis: Temporary retreat

GBP/USD price

From the technical point of view, the GBP/USD pair found support on the weekly pivot point of 1.2170 and is now fighting hard to rebound. The descending pitchfork’s median line (ML) and the 1.2153 represent downside obstacles. As long as it stays above these levels, the price could try to resume its upside movement.

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The ascending trendline stands as a major dynamic support. The bias is bullish as long as it stays above it. The upper median line (UML) and the 1.2293 represent upside obstacles. Taking out the resistance levels and making a new higher high activates further growth. An upside continuation could be invalidated only by a valid breakdown below the ascending trendline.

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