GBPUSD holds a bullish bias but the momentum is weak

GBPUSD returned back above the medium-term uptrend line after the fall below the 23.6% Fibonacci retracement level of the upward wave from 1.0325 to 1.2450 at 1.2050. Currently, the price is losing some momentum, confirmed by the technical oscillators. The MACD is moving sideways near the zero level, while the RSI is sloping down near the 50 neutral threshold of 50.

Failure to remain above the ascending line could send the price down to the 200-day simple moving average (SMA) at 1.2000, which has been a challenging point over the last two weeks. Lower, support could next be found around the 50-day SMA, which is moving near the 23.6% Fibonacci at 1.2050, while a decisive close below the 1.1900 round number could stage a steeper sell-off.

Alternatively, if 1.2240 proves easy to get through, the spotlight will turn to the six-month high of 1.2450. On top of that, the bulls would need to clear the 1.2670 barrier, achieved in May 2022.

In the medium-term picture, GBPUSD turned neutral after violating the uptrend started from the 1.0535 bottom. Should the market continue the upward pattern, the outlook may turn brighterA run above 1.2450 would turn the outlook strongly bullish.

About the author

Melina Deltas

Melina joined XM in December 2017 as an Investment Analyst in the Research department. She can clearly communicate market action, particularly technical and chart pattern setups. Her technically focused method looks mainly at price action across multiple time frames to capture big moves that develop over the years. She has more than 3 years of experience in analyzing financial markets, specializing in forex, indices, and commodities. Melina studied Pure Mathematics at Lancaster University and has a Master's Degree in Monetary and Financial Economics from the University of Cyprus. Currently, she is an associate member of the Society of Technical Analysts (STA) and a Certified Financial Technician (CFTe).