- The GBP/USD pair once again managed to find decent support ahead of the 1.2100 handle and rallied over 40-pips to refresh session tops in the last hour.
- The said handle nears 200-hour SMA and the lower end of an ascending trend-channel on hourly charts, which should act as a key pivotal point for traders.
Given the pair’s recent downfall, the mentioned channel now seemed to constitute towards the formation of a bearish continuation – flag pattern – on short-term charts, supporting prospects for a further near-term depreciating move.
A convincing breakthrough the trend-channel support will reinforce the bearish set-up and set the stage for a sharp slide back towards challenging the key 1.2000 psychological mark with some intermediate support near mid-1.2000s.
Meanwhile, technical indicators on the daily chart maintained their bearish bias and add credence to the negative outlook, albeit bullish oscillators on hourly charts warrant caution before placing any aggressive bets.
On the flip side, immediate resistance is pegged near the 1.2175-80 region and is closely followed by the 1.2200-1.2210 region – which coincides with the top end of the ascending channel and should keep a lid on any subsequent up-move.
GBP/USD 1-hourly chart