GBPUSD refreshed its monthly high the previous day but the bulls don’t have smooth sailing due to the weekly closing below the 1.2630-40 horizontal hurdle. That said, RSI and MACD have been supportive of the recovery moves and hint at the further upside. However, a convergence of the descending trend line from February and the 50-DMA, around 1.2775-80, appears a tough nut to crack for the buyers. It’s worth noting, though, that a clear run-up beyond 1.2780 could propel the prices towards a 50% Fibonacci retracement of February-May downside, near 1.2950.
Meanwhile, pullback moves may initially dribble around the 23.6% Fibonacci retracement level of 1.2530 before the GBPUSD bears approach a one-month-old horizontal support area surrounding 1.2400. Should the quote fail to bounce off 1.2400, the 1.2260-55 region can act as the last defense for the sellers. During the cable’s weakness past 1.2250, the recent multi-month low around mid-1.2100s and the May 2020 bottom of 1.2075 will gain the market’s attention.
Overall, GBPUSD approaches the short-term key hurdles which hold the keys to a trend change.