- GBP/USD picks up bids to portray the third U-turn from 1.2000.
- RSI, MACD both suggest that bears are running out steam.
- Bulls need validation from weekly resistance line, 200-HMA.
GBP/USD picks up bids to reverse the initial losses around 1.2030 heading into Wednesday’s London open. In doing so, the Cable pair marks the third rebound from the 1.2000 psychological magnet while probing the bearish bias portrayed on Tuesday.
Although one-week-old horizontal support near 1.2000 restricts the immediate downside of the GBP/USD pair, recovery remains elusive unless the quote crosses a downward-sloping resistance line from December 19, close to 1.2090 by the press time.
That said, the 1.2050 mark and the 100-HMA level surrounding 1.2070 restrict immediate recovery moves of the Cable pair.
It’s worth noting that the GBP/USD pair’s upside past 1.2070 will need validation from the 200-HMA hurdle, close to 1.2140 at the latest, a break of which could give control to the buyers.
Meanwhile, a clear downside break of the 1.2000 round figure precedes the monthly low of 1.1992 to restrict the short-term GBP/USD declines.
Following that, the late November swing low of 1.1900 will gain the market’s attention as the pair’s sustained trading below the same could put the sellers in the driver’s seat.
Overall, GBP/USD is likely to consolidate recent losses but the recovery remains doubtful below 1.2140.
GBP/USD: Hourly chart
Trend: Limited recovery expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays weak below 1.0500 due to risk-off mood
EUR/USD remains depressed below 1.0500 in Tuesday's European morning as US President-elect Trump’s tariff plans dampen the market sentiment and keep the US Dollar broadly bid. The Euro struggles due to growing Euro area economic concerns and increased dovish ECB bets.
GBP/USD consolidates losses near 1.2550 ahead of BoE's Pill, Fed Minutes
GBP/USD struggles near 1.2550 in European trading on Tuesday, following a slump to the 1.2500 area. The US Dollar holds on to modest gains amid Trump's tariffs threat-driven cautious mood, keeping the pair undermined ahead of BoE Pill's speech and Fed Minutes.
Gold price defends $2,600 ahead of FOMC minutes; not out of the woods yet
Gold price retains its negative bias for the second straight day and trades just above a one-week low during the first half of the European session on Tuesday. The growing conviction that Donald Trump's expansionary policies will reignite inflation and limit the scope for the Fed to cut interest rates further triggers a fresh leg up in the US Treasury bond yields.
Trump shakes up markets again with “day one” tariff threats against CA, MX, CN
Pres-elect Trump reprised the ability from his first term to change the course of markets with a single post – this time from his Truth Social network; Threatening 25% tariffs "on Day One" against Mexico and Canada, and an additional 10% against China.
Eurozone PMI sounds the alarm about growth once more
The composite PMI dropped from 50 to 48.1, once more stressing growth concerns for the eurozone. Hard data has actually come in better than expected recently – so ahead of the December meeting, the ECB has to figure out whether this is the PMI crying wolf or whether it should take this signal seriously. We think it’s the latter.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.