Technical Analysis – Will GBPUSD manage to overcome the 1.2440 hurdle?
March 31, 2023 12:27 pm
GBPUSD traded lower on Friday but triggered some buy orders near the 1.2350 zone and rebounded. That zone acted as resistance on March 23 and 29 and thus, as long as the pair stays above it, the chances for a move higher likely remain decent. In the somewhat bigger picture, GBPUSD is trading above the uptrend line drawn from the low of March 8 and above all three of the plotted moving averages.
Both short-term momentum indicators are detecting upside speed, with the RSI staying above 50 and the MACD lying above both its zero and trigger lines. That said, despite turning up in the last few hours, earlier, the RSI pulled back after hitting resistance at its 70 line.
Therefore, it may be wiser to wait for a break above the key hurdle of 1.2440 before examining a trend continuation. That zone has been acting as a ceiling for Cable since December. If the bulls are now strong enough to overcome it, they may feel confident to drive the battle up to the high of June 9 at 1.2560, or the peak of June 7 at 1.2600. If they are not willing to stop at either of those barriers, they could extend their march towards the high of May 27 at 1.2670.
On the downside, a break below 1.2350 and the aforementioned uptrend line could dismiss the bullish case. However, the move confirming a short-term bearish reversal may be a dip below 1.2290, marked by yesterday’s low. Such a slide could pave the way towards the 1.2190 zone, the break of which could carry extensions towards the 1.2025 territory, which offered support on March 15 and 16.
To sum up, GBPUSD is trading above a short-term uptrend line and above all three of the plotted moving averages in the 4-hour chart. Nonetheless, a break above the key resistance of 1.2440 may be needed to spread confidence about an uptrend continuation.
GBPUSD traded lower on Friday but triggered some buy orders near the 1.2350 zone and rebounded. That zone acted as resistance on March 23 and 29 and thus, as long as the pair stays above it, the chances for a move higher likely remain decent. In the somewhat bigger picture, GBPUSD is trading above the uptrend line drawn from the low of March 8 and above all three of the plotted moving averages.
Both short-term momentum indicators are detecting upside speed, with the RSI staying above 50 and the MACD lying above both its zero and trigger lines. That said, despite turning up in the last few hours, earlier, the RSI pulled back after hitting resistance at its 70 line.
Therefore, it may be wiser to wait for a break above the key hurdle of 1.2440 before examining a trend continuation. That zone has been acting as a ceiling for Cable since December. If the bulls are now strong enough to overcome it, they may feel confident to drive the battle up to the high of June 9 at 1.2560, or the peak of June 7 at 1.2600. If they are not willing to stop at either of those barriers, they could extend their march towards the high of May 27 at 1.2670.
On the downside, a break below 1.2350 and the aforementioned uptrend line could dismiss the bullish case. However, the move confirming a short-term bearish reversal may be a dip below 1.2290, marked by yesterday’s low. Such a slide could pave the way towards the 1.2190 zone, the break of which could carry extensions towards the 1.2025 territory, which offered support on March 15 and 16.
To sum up, GBPUSD is trading above a short-term uptrend line and above all three of the plotted moving averages in the 4-hour chart. Nonetheless, a break above the key resistance of 1.2440 may be needed to spread confidence about an uptrend continuation.
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