- GBP/USD witnessed an intraday turnaround from the 50% Fibo. level support.
- The set-up supports prospects for an extension of the goodish intraday bounce.
- Sustained weakness back below the 1.2500 mark will negate the positive outlook.
The GBP/USD pair stalled its recent corrective slide from three-month tops and managed to find decent support near mid-1.2400s – the 50% Fibonacci level of the 1.2076-1.2788 positive move. The pair rallied around 100 pips from daily swing lows and jumped to fresh session tops, around mid-1.2500s in the last hour, breaking through a resistance marked by 38.2% Fibo. level.
Meanwhile, oscillators have been recovering from the bearish territory on the 1-hourly chart and maintained their bullish bias on the daily chart, supporting prospects for additional gains. Hence, a move back towards reclaiming the 1.2600 round-figure mark, ahead of the high-level EU-UK trade meeting, now looks a distinct possibility amid some renewed USD selling bias.
Some follow-through buying has the potential to lift the pair further towards the next major hurdle near the 1.2640 confluence region – comprising of 200-hour SMA and 23.6% Fibo. level.
On the flip side, the key 1.2500 psychological mark now seems to protect the immediate downside, which if broken might accelerate the fall back towards the daily swing lows, around the 1.2400s. Failure to defend the mentioned support level might be seen as a fresh trigger for bearish traders and set the stage for an extension of the corrective slide from levels beyond the 1.2800 mark.
GBP/USD 1-hourly chart
Technical levels to watch