GBPUSD printed another lower low at 1.2848 on Thursday, making the case for a down-trending market more real. Also, the pair seems to be trading within a downward-sloping channel that has been keeping the market action under control since the start of the month, while the bearish cross between the 20- and 50-day simple moving averages (SMAs) is another negative trend signal for the market.
Should the channel keep rejecting upside corrections, Thursday’s low of 1.2848, which is near the 50% Fibonacci of the 1.2200-1.3513 upleg, could provide immediate support before the spotlight turns to the 1.2780 barrier and then towards the 200-day SMA and the bottom of the channel, both at 1.2700.
Alternatively, a rise above the channel could be more valuable if the price manages to close above the 50-day SMA and the previous high of 1.3068, probably triggering a steeper rally towards the 1.3175-1.3200 resistance region.
Meanwhile in the medium-term window, the neutral outlook is still intact as long as the price keeps fluctuating between 1.2780 and 1.3280.
Summarizing, GBPUSD is expected to perform neutral-to-bearish in the short-term as the RSI and the MACD currently suggest, unless it breaks above the channel and more importantly above 1.3068.