Bullish Momentum for GBPUSD Holds Above 200-Day Moving Average, Yet Faces Challenges from Thin Daily Cloud
The British Pound’s recent upward movement, known as “Cable,” has been steady following the double bottom formation around 1.2540 (April 1st and 2nd lows). Currently, it is challenging a significant resistance level at 1.2674, marked by the daily cloud top and the Fibonacci 38.2% retracement of the move from 1.2893 to 1.2539. This surge comes as bullish momentum regained strength following a brief dip below the crucial 200-day moving average support at 1.2586.
In the short term, the market outlook suggests a slight inclination towards bullishness as long as the price remains above the 200-day moving average. However, to confirm a fresh bullish signal, a sustained breakthrough above the 1.2674 level is imperative. Several attempts to surpass this barrier have been thwarted by the thin daily cloud.
Analyzing daily indicators reveals a lack of clear directional signals. Moving averages present a mixed setup, the Relative Strength Index (RSI) is oscillating sideways within a neutral zone, and the 14-day momentum is showing upward movement but remains in negative territory.
While the Pound benefits from a weaker Dollar, there remains a possibility of a recovery slowdown, particularly if the market continues to struggle with breaking through the daily cloud. Such repeated failures could expose the Pound to downside risks, a scenario that should not be disregarded.
Res: 1.2674; 1.2716; 1.2758; 1.2803
Sup: 1.2638; 1.2586; 1.2539; 1.2518
