GBPUSD has been developing above the 10-month low of 1.2960 that it posted last Thursday, but with weak momentum. Moreover, the price seems to be turning negative again as it holds below the 20- and 40-simple moving averages in the daily timeframe. It is worth mentioning that the cable is still developing below the 23.6% Fibonacci retracement level of the downleg from 1.4375 to 1.2960, around 1.3290.
In the short-term, the technical indicators are recommending further downside pressure. The RSI indicator is falling with weak momentum below the threshold of 50, while the MACD oscillator is still moving below its trigger line and remains in the negative territory. Still, downside risks have not faded out yet as both indicators continue to fluctuate in bearish zones.
A further decline could find support at the lower Bollinger Band near 1.3013, where if the bearish moves appear stronger, the price could hit the 10-month low (1.2960). If the price fails to hold above this level, this would open the way towards the 1.2770 barrier, taken from the low on August 2017.
Should the price climb above the 20- and 40-SMAs of 1.3165 and 1.3233 respectively, traders would turn their focus towards the 23.6% Fibonacci of 1.3290. In case of further gains, bulls could push the pair until the 1.3475 resistance level, taken from the high on June 7, which stands near the 38.2% Fibonacci of 1.3500.
In the medium term, the neutral to bearish outlook remains intact, with the Bollinger Band appearing to follow a sideways downward movement. Having a look at the weekly timeframe, the 20-SMA posted a bearish crossover with the 40-SMA.
