December 11, 2023

Bulls have the upper hand above 100-DMA, move beyond 1.3600 awaited

  • GBP/USD was seen consolidating its recent gains to a near two-month high.
  • The set-up supports prospects for a further near-term appreciating move.
  • Any meaningful dip might still be seen as an opportunity for bullish traders.

The GBP/USD pair extended its sideways consolidative price action and remained confined in a narrow trading band, just below the 1.3600 mark through the mid-European session.

From a technical perspective, acceptance above the 100-day SMA supports prospects for an extension of the recent appreciating move further beyond the 61.8% Fibonacci level of the 1.3834-1.3161 fall. Some follow-through buying beyond the 1.3600 mark will reaffirm the positive outlook.

The GBP/USD pair might then accelerate the momentum towards testing a descending trend-line hurdle, around the 1.3675 region. The mentioned barrier extends from July 2021 swing high and should act as a key pivotal point, which if cleared will be seen as a fresh trigger for bullish traders.

On the flip side, the 100-day SMA, currently around mid-1.3500s, now seems to protect the immediate downside. Any subsequent decline might still be seen as a buying opportunity and remain limited near the key 1.3500 psychological mark, which coincides with the 50% Fibo. level.

A convincing break below the mentioned support levels could prompt some technical selling and drag the GBP/USD pair to the 1.3460-55 region en-route the 1.3430 area. This is followed by the 38.2% Fibo. level/50-day SMA confluence resistance breakpoint, near the 1.3400 round figure.

GBP/USD daily chart


Technical levels to watch


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