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24 April 2024 | FXGT.com

GBP/USD Tests $1.2470 Resistance Ahead of Key US GDP and PCE Releases

  • Market Trend: The GBP/USD pair has declined by 1.40% since the start of April, marking a continued downward pressure on the British pound. The currency pair has developed a strong downtrend on the daily chart, accelerated by the break below the previous long-term support level of $1.25, pushing the market to a recent low of $1.23 at the start of this week.
  • Signs of Recovery: A bullish signal emerged yesterday with the formation of a morning star candlestick pattern on the daily chart, indicating potential for a further upwards retracement. This pattern appeared as the Relative Strength Index (RSI) entered oversold territory, falling below 30. Additionally, the price has broken out of a short-term downward channel line, reinforcing the potential for continued bullish momentum.
  • Immediate Resistance: A decisive move above Friday’s high of $1.2470 could trigger an extended bullish wave, potentially driving the price towards $1.2550, where it will encounter resistance from the daily exponential moving average channel.
  • Bearish Sentiment: Despite recent recovery signs, the main trend remains bearish with potential for the downtrend to resume. Should the price fail to surpass the $1.2470 resistance, bearish momentum could reassert itself, possibly driving the pair back down to the recent low of $1.23. In the short term, support is outlined at $1.24, which will be crucial for maintaining any further bullish correction.
  • US Data Watch: The upcoming release of U.S. GDP data on Thursday and the Personal Consumption Expenditures (PCE) index on Friday are anticipated to bring significant volatility and influence price movements. These economic indicators are crucial and likely to act as catalysts for the next directional move in the currency pair.

GBPUSD 4 Hour Chart

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