GBPUSD created a spike to the upside on Thursday, surpassing the 1.3700 round number and recording a fresh 33-month high before it returned lower.
In trend indicators the 20- and 40-period simple moving averages (SMAs) posted a bullish crossover in the 4-hour chart, while the red Tenkan-sen line is holding above the blue Kijun-sen line in a flat mode. The RSI, in the positive region, is pointing slightly down and the MACD is dropping below the trigger line in the bullish area.
If the price continues to head lower, immediate support would come from the 20-period SMA at 1.3648 before meeting the 1.3610 support around the Ichimoku cloud and the 40-period SMA. More downside pressure could suggest a bearish correction, hitting the 100-period SMA currently at 1.3560 and the 23.6% Fibonacci retracement level of the up leg from 1.2850 to 1.3708 at 1.3507. If selling interest persists, the 1.3450 barrier could attract traders’ attention.
A jump above the 33-month high of 1.3708 could take the price even higher towards the next resistance at 1.4345, registered on January 18; however, it needs first to overcome the psychological levels such as 1.3800, 1.3900, and 1.4000.
In conclusion, GBPUSD has been in a strong positive mode since March 2020, and the recent decline in the very short-term is not enough to shift the market to neutral.
Origin: XM
