GBP/USD Price Analysis: The potential upside barrier is seen at the 1.2700-1.2710 zone
|- GBP/USD trades on a softer note around 1.2685 on the firmer USD.
- The pair maintains a bullish outlook above the key EMA.
- The key resistance level is seen at the 1.2700–1.2710 zone; the initial support level is located at 1.2650.
The GBP/USD pair snaps the two-day winning streak during the early European session on Tuesday. The major pair edges lower amid the modest recovery of the US Dollar (USD). February’s labor market report this week will be a closely watched event. At press time, GBP/USD is trading at 1.2685, down 0.03% on the day.
From a technical perspective, the bullish outlook of GBP/USD remains intact as the major pair is above the key 100-period Exponential Moving Average (EMA) on the four-hour chart. It’s worth noting that the Relative Strength Index (RSI) lies above the 50 midlines, indicating the path of least resistance is to the upside.
The potential resistance level for the pair is seen at the 1.2700-1.2710 region, portraying the confluence of the upper boundary of the Bollinger Band, a psychological round figure, and a high of March 4. A break above this level will pave the way to a high of January 31 at 1.2750. Any follow-through buying will see a rally to a high of January 12 at 1.2785.
On the downside, the initial contention level is located near the 100-period EMA at 1.2650. Further south, the next downside target will emerge near the lower limit of the Bollinger Band at 1.2612. The additional downside filter to watch is a low of February 20 at 1.2580, followed by a low of December 11 at 1.2535.
GBP/USD four-hour chart
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