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Overview :
The Pound against US dollar has gone back and forth during the course of the week again, testing the 1.3109 support level. If it were to break below the 1.3109 level, then it is very likely that the US dollar will continue to strengthen against the Pound.
Today, the GBP/USD pair is trading in the range of 1.3109 - 1.2997 about a weekly low. On the hourly chart, the pair fell below the moving average line MA (50) H1 (1.3109) and on the four-hour chart - below MA (100) H4 (1.3174).
Technically speaking, the support of 1.3050 can keep prices from further decline. The upper limit of 1.3174 represents the main resistance level. The most likely range of the pair's movement for today may be hidden within the range of 1.3109-1.3050 (small range)
On a break below the candlestick (1.3109 support 1) from the previous week, then it is likely that the market will go looking towards the 1.3050 level, which was the most recent low.
The GBP/USD pair certainly has been in a strong channel for quite some time, and therefore it is likely that it will eventually find its way towards the 1.3050 level. Moreover, if it breaks down below the candlestick for the week, then the market may very well go looking towards the 1.2997 level.
Today, the first support level is seen at 1.3050 , and the price is moving in a bearish channel now. Furthermore, the price has been set below the strong resistance at the level of 1.3174, which coincides with the 50% Fibonacci retracement level.
This resistance has been rejected several times confirming the downtrend. Additionally, the RSI starts signaling a downward trend.
As a result, if the GBP/USD pair is able to break out the first support at 1.3050, the market will decline further to 1.2997 in order to test the weekly support 2.
In the H4 time frame, the pair will probably go down because the downtrend is still strong. Consequently, the market is likely to show signs of a bearish trend. So, it will be good to sell below the level of 1.3174 with the first target at 1.3050 and further to 1.2997.
At the same time, the breakup of 1.3174 will allow the pair to go further up to the levels of 1.3298 in order to retest the weekly top again.
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