GBPUSD held within the 1.3500 territory on Monday and slightly below its 2 ½-year high of 1.3623 following the endorsement of a skinny Brexit trade deal and the approval of the US stimulus package.
From a technical perspective, the short-term bias remains tilted to the upside despite the rejection around the topline of the upward-sloping channel as the price continues to trade above its simple moving averages (SMAs) and the Ichimoku cloud. The momentum indicators are also in favor of the bulls, with the RSI recovering above its 50 neutral mark and the MACD regaining strength above its red signal line.
A decisive run beyond the 1.3600 level and the resistance line could attract new buyers into the market, likely pushing the price up to the 1.3755 mark and then towards the 1.3900 – 1.3950 restrictive zone – both have been key barriers in the first half of 2018.
Alternatively, a downside reversal could initially stabilize around 1.3348, a break of which may confirm additional losses towards 1.3180. Slightly lower, the crucial supportive trendline could trigger a sharper bearish wave towards the 200-day SMA if violated, especially if the pair manages to clearly breach the bottom of the cloud currently seen around 1.2990.
Summarizing, GBPUSD’s uptrend has yet to show any convincing signs of exhaustion, with traders eagerly waiting for a move above 1.3600 to show fresh buying interest.
