GBPUSD remains entrenched in a bearish trend on the higher timeframe, despite a bullish retracement creating temporary upward momentum on lower timeframes. With the price currently in overbought territory, the bearish trend is expected to resume soon.
GBPUSD Key Levels
Demand Levels: 1.2500, 1.2400, 1.2300
Supply Levels: 1.2800, 1.31000, 1.3300
GBPUSD Long-Term Trend: Bearish
The GBPUSD pair witnessed a well-defined bullish trend earlier this year, climbing from 1.2200 to 1.3300 through four distinct reaccumulation phases. This upward momentum peaked at 1.3400 on September 26 before reversing. In November, the 30-period Moving Average crossed below the 50-period Moving Average, signaling a bearish shift. Both Moving Averages now hover above the daily candles, reinforcing the downward trend.
After an extended reaccumulation phase into early November, GBPUSD experienced a sharp drop to the 1.2600 support level. This level provided a base for a bullish retracement; however, the 30-period Moving Average has already capped the recovery. Furthermore, the Williams Percent Range shows the market is overbought, suggesting limited potential for further upward movement.
GBPUSD Short-Term Trend: Bullish
On lower timeframes, GBPUSD continues its bullish retracement, with price action forming higher highs and higher lows. However, this upward movement is considered temporary, with an anticipated structural shift expected to align with the dominant bearish trend.
The swing low of 1.2500, which preceded the retracement, serves as a viable target for short positions. Traders should monitor for reversal signals as the market approaches a Fair Value Gap region on the higher timeframe. With forex signals embedded into trading strategies, traders can make informed decisions amid the ongoing market dynamics.
Note: Learn2.trade is not a financial advisor. Do your research before investing your funds in any financial asset, product, or event. We are not responsible for your investment results.
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