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Technical Analysis – GBPUSD retreats from one-month high

  • GBPUSD remains above downtrend line

  • RSI and stochastic move lower

GBPUSD is trading around the vicinity of 1.2630 after the pullback from the one-month high around the 1.2708 barrier. The pair failed on a second attempt to breach the overpowering latter level.

Looking to the short-term oscillators, the stochastics and the RSI indicate bearish movements as the first posted a bearish crossover within its %K and %D lines in the overbought region, while the RSI is heading south above the 50 threshold.

If sellers take control, initial support could come from the 1.2630 mark ahead of the 50-day simple moving average (SMA) around 1.2580, which stands near the short-term downtrend line. Diving further, the 20- and the 200-day SMAs, which are ready for a golden cross, at 1.2535 may act as a strong turning point in the market.

Should buyers drive above the 1.2708 resistance, they could encounter initial strengthened resistance from the 1.2820 barrier. A step above may meet further constrictions from the six-month high of 1.2892.

All in all, the very short-term timeframe sustains a neutral-to-bullish mode for now. However, a break below or above the bounds of 1.2892 or 1.2300 could reveal the next direction.

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