Wednesday’s broadband US Dollar weakness allowed GBPUSD bulls to extend the week-start rebound from an upward-sloping support line stretched from December 2023. The Cable pair’s recovery also gained support from the upbeat RSI (14) line and bullish MACD signals. However, the 100 and 200-bar Exponential Moving Averages (EMAs), respectively around 1.2650 and 1.2665, guard the immediate upside of the pair. Following that, a one-month-old descending resistance line surrounding 1.2700 will be the last defense of the sellers. In a case where the quote remains firmer past 1.2700, the odds of witnessing a run-up toward the late March swing high of 1.2800 and then to the yearly peak of 1.2893 can’t be ruled out.
Meanwhile, a slew of technical levels stands ready to challenge the GBPUSD bears beyond the 1.2600 threshold. Even if the Pound Sterling drops beneath the 1.2600 support, the aforementioned multi-day-old support line, near 1.2540 as we write, will restrict the quote’s further downside. It’s worth noting that the 2024 low and December 2023 trough could act as the last hurdles for the sellers around 1.2520 and 1.2500 in that order, a break of which could make the prices vulnerable to slump toward the 1.2400 mark.
Overall, the GBPUSD pair is likely to witness further upside but the reversal of a month-long bearish trend needs validation from the 1.2700 breakout, as well as the downbeat US data.
