GBPUSD is still trading upward, however it has reversed below 1.2400.
GBPUSD breaks a two-day losing run earlier in the day, but subsequently reverses. Trading higher at 1.2390 during the early European trading hours on Monday.
The pair gained ground, most likely. As a result of the disappointing consumer mood data from the United States (US) reported on Friday.
The preliminary US Michigan Consumer Sentiment Index was 67.7. Representing a decrease from the prior number of 69.5. This reading was likewise lower. GBPUSD pair retreats below 1.2400, with the attention shifting to central bank decisions.
GBPUSD Techincal Outlook
GBPUSD is still trading upward, however it has reversed below 1.2400.
Momentum indicators point to a possible negative trend in the Cable pair.
The immediate support looks around the June lows. Followed by the psychological threshold of 1.2350.
GBPUSD breaks a two-day losing run earlier in the day. But subsequently reverses, trading higher at 1.2390. During the early European trading hours on Monday. The pair gained ground, most likely as a result of the disappointing consumer mood data from the United States. Which came in at 69.1 for the month of September.
Investors anticipate that the Bank of England (BoE) will raise interest rates by 25 basis points at its forthcoming meeting on Tuesday. . On the other hand, the US Federal Reserve (Fed) is likely to keep interest rates unchanged on Wednesday.
The GBPUSD pair may meet resistance at the nine-day Exponential Moving Average (EMA) of 1.2463. Followed by the 12-day EMA of 1.2488.
A strong break over the psychological threshold of 1.2500 might push the pair to the zone around the 23.6% Fibonacci retracement around 1.2560.
On the other hand, initial support for the GBPUSD pair lies around the June lows of 1.2368, followed by the psychological level of 1.2350.
If bearish sentiment persists, the currency pair may reach the next support level near the lows observed in May at 1.2308, followed by the psychological level of 1.2300.
The Moving Average Convergence Divergence (MACD) line is still negative. The signal line and displays divergence underneath it. This formation shows a potential bearish market momentum, which can be seen as a hint that the recent downward trend may continue.
Traders of the GBPUSD pair are likely to pay attention to the 14-day Relative Strength Index (RSI).
Traders of the GBPUSD pair are likely to pay attention to the 14-day Relative Strength Index (RSI). Which signals negative momentum in the short term because it is below the 50 mark.
