GBP/USD Price Analysis: Bulls looking to extend the momentum beyond 200-hour SMA
- GBP/USD surged past the 1.2800 round-figure mark during the early European session.
- The technical set-up warrants some caution for bulls and positioning for additional gains.
- Any subsequent move to the 1.2880 might be seen as an opportunity for bearish traders.
The GBP/USD pair spiked to fresh daily tops, around the 1.2840 region during the early European session, with bulls now looking to build on the momentum beyond 200-hour SMA.
The mentioned area coincides with the 50% Fibonacci level of the 1.3007-1.2676 recent slide. A sustained move beyond will be seen as a fresh trigger for intraday bullish traders follow-through and pave the way for a move back towards the 1.2900 mark.
Meanwhile, RSI (14) on the 1-hourly chart is already flashing overbought conditions. Moreover, technical indicators on the daily chart maintained their bearish bias and are yet to register any meaningful recovery, warranting caution for bulls.
Hence, any subsequent move might still be seen as an opportunity to initiate some fresh bearish positions. This, in turn, might cap the upside for the major near the 61.8% Fibo. level, around the 1.2880 zone.
On the flip side, the 1.2800 mark – coinciding with the 38.2% Fibo. level – now seems to protect the immediate downside. Failure to defend the mentioned support might turn the GBP/USD pair vulnerable to resume its recent downward trajectory.
Bears might then aim back to challenge the very important 200-day SMA support before eventually dragging the pair back towards multi-week lows, around the 1.2675 region.
GBP/USD 1-hourly chart
