GBP/USD Price Analysis: Sterling Soars Towards 1.2700 as US Dollar Falters
Technical Outlook: GBP/USD Momentum Shifts, Downside Risks Emerge
Despite the recent surge, the daily chart paints a neutral to slightly bearish picture for the GBP/USD pair. While currently trading above the daily moving averages (DMA), the Relative Strength Index (RSI) has turned bearish, indicating a potential shift in momentum towards the sellers.
If the GBP/USD fails to hold above 1.2700, the pair could be vulnerable to further declines. Key support levels to watch include the 100-DMA at 1.2643, followed by the 50-DMA at 1.2627. A deeper retracement could see the pair test the 1.2600 psychological level and potentially the 200-DMA at 1.2553, opening the door for a drop towards 1.2500.
Upside Potential Limited, But Not Ruled Out
While the current outlook suggests downside risks, a break above 1.2700 could trigger a short-term rally towards 1.2750. However, given the overall technical picture and the prevailing market sentiment, this scenario seems less likely in the near term.