- GBP/USD tumbles to the psychological support amid a stable US Dollar.
- A break below the 14-day EMA at 1.2692 could push the pair to approach the major support at 1.2650.
- Traders would likely await the MACD to confirm the momentum before placing bets.
GBP/USD halts its three-day winning streak, trading around 1.2700 psychological level during the Asian session on Monday. The GBP/USD pair seems to face a critical juncture, with the possibility of a break below the psychological level. If this occurs, it could surpass the 14-day Exponential Moving Average (EMA) at 1.2692.
A breach below this support region might exert downward pressure on the GBP/USD pair, potentially leading it to navigate toward the major support at 1.2650. This level aligns with the 23.6% Fibonacci retracement at 1.2643, serving as a significant area to watch for potential price movements.
However, the technical indicator 14-day Relative Strength Index (RSI) is positioned above the 50 level indicating bullish momentum, suggesting an upward outlook for the GBP/USD pair.
Additionally, the technical analysis of the GBP/USD pair suggests an interesting situation with the Moving Average Convergence Divergence (MACD) indicator. The MACD line is positioned above the centerline, indicating potential bullish momentum. However, there is divergence below the signal line, suggesting a nuanced scenario. Investors might be exercising caution and awaiting confirmation from the MACD before making their bets.
On the upside, the 1.2750 level could act as the major barrier followed by the previous week’s high at 1.2771. A breach above the latter could support the GBP/USD pair to explore the region around the psychological level at 1.2800.
GBP/USD: Daily Chart
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