GBPUSD – bears pause following a sharp three-day decline; the broken 200DMA now serves as strong resistance

The GBPUSD pair is trading within a tight consolidation range in early Wednesday sessions, as bearish momentum eases following a steep three-day decline of 1.85%.

Tuesday’s break and close well below key support levels at 1.2846 (76.4% Fibonacci retracement of the 1.2664/1.3434 rise) and 1.2817 (200DMA) provided a strong bearish signal.

Markets are awaiting the release of October’s US inflation data (due later today), which has kept the pair in a subdued mode this morning.

The broken 200DMA and Fibonacci levels have now turned into resistance points, likely to cap any upticks and support the broader bearish outlook. Resistance at the 10DMA (1.2894) and 20DMA (1.2938) levels should contain any moves higher; a break above these could challenge the bears and open the way for a potential test of the 1.3000 level (psychological mark / 100DMA).

Res: 1.2776; 1.2817; 1.2846; 1.2894
Sup: 1.2719; 1.2664; 1.2612; 1.2599