Yesterday, the GBP/USD exchange rate declined to the 1.2260 level. During Wednesday morning, the rate was trying to surpass the weekly and monthly S1s at 1.2290.
If the given resistance level holds, it is likely that a reversal south could occur, and some downside potential could prevail in the market. Note that the nearest support level—the Fibo 38.20%, is located at 1.2190.
However, if the given resistance does not hold, it is likely that the British Pound could appreciate against the US Dollar in the short run. In this case the currency pair would have to surpass the 55– and 100-hour SMAs in the 1.2320/1.2350 range.
