- GBP/USD struggles to keep the bounce off one-month-old ascending support line.
- Sustained downside break of 200-SMA, downbeat RSI conditions keep sellers hopeful.
- The 1.2080 resistance confluence restricts immediate recovery moves.
GBP/USD stays defensive around 1.2030, fading the bounce off the monthly support line, as bears await fresh clues to retake control during early Wednesday.
That said, an upward-sloping support line from November 30, around the 1.2000 psychological magnet by the press time, restricts the Cable pair’s short-term downside.
However, the latest successful break of the 200-SMA joins the downbeat RSI (14), not oversold, to keep bears hopeful of conquering the stated support and retaking control.
Following that, the monthly low of 1.1990 and the late November bottom surrounding 1.1900 could lure the GBP/USD sellers. Though, the 50% and 61.8% Fibonacci retracement levels of the pair’s November-December run-up, respectively near 1.1800 and 1.1645, could challenge the quote’s further declines.
It’s worth noting that the late October swing high adds strength to the 1.1645 support level.
Alternatively, a convergence of the 200-SMA and one-week-old descending trend line highlights the 1.2080 level as the key hurdle for the GBP/USD bulls.
In a case where the Cable buyers keep the reins past 1.2080, the previous weekly top near 1.2245 and the early December top close to 1.2345 could probe the upside momentum before highlighting the monthly peak of 1.2445 as the target for the GBP/USD bulls.
GBP/USD: Four-hour chart
Trend: Further downside expected
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