GBPUSD settled into a tight range of 1.3960 – 1.3980 in the four-hour chart following the quick bounce on the 50-period simple moving average (SMA), which faded at a fresh 33-month high of 1.3985 on Thursday.
The ongoing narrow sideways move brings to mind a bullish rectangle pattern in a lower timeframe (1-hour chart), foreseeing the continuation of the bullish trend. That said, we cannot rule out a delayed upside breakout as the price is in breathing distance underneath the 1.3995 barrier which troubled the market in early 2018. A decisive close above it could send resistance up to the 161.8% Fibonacci extension of the latest pullback at 1.4025, while slightly higher the 1.4085 could be another hurdle ahead of 1.4150.
Note that the oscillators have yet to confirm overbought conditions as the RSI is regaining strength towards the 70 mark, while the Stochastics, although weaker, seem to look for another bullish cross above 80.
On the downside, the bears may have set a trap around 1.3950 with scope to drive the pair towards the 20-period SMA at 1.3910. Beneath that, the next pick up point could be somewhere between the 50-period SMA at 1.3865 and the 1.3830 support.
Summing up, GBPUSD bulls are still persisting in the four-hour chart, though they may need to breach the heavy barrier around 1.3995 to prove their resilience.