GBPUSD is pivoting around its 50-day moving average, remaining mostly neutral for now, with risk tilted to the upside.
The corrective move of the uptrend to 1.3656 appears to have stabilized above the key 1.3000 level after the sell-off from September 20 to October 6 has turned into a consolidation phase.
The outlook is positive since the market has held above 1.3000 and has also crossed above its 50-day MA. Prices have broken above what was a key resistance level at the 50% Fibonacci retracement (1.3215) of the upleg from 1.2773 to 1.3656.
GBPUSD is now testing the 38.2% Fibonacci (1.3317). The RSI indicator is neutral for now but above 50 in bullish territory, suggesting a break higher is possible. A daily close above 1.3350 would confirm the short-term bullish phase to target 1.3448 (23.6% Fibonacci) followed by 1.3500. From here prices would target 1.3600 and see a re-test of the 1.3656 peak for a resumption of the medium-term uptrend.
The underlying trend higher is considered to be intact as long as the market remains above 1.3000. However, the sideways range that followed the drop from 1.3656 is expected to continue unless there is a sustained rally through the mid-1.3500 area.
