In recent trading sessions, the GBP/USD pair exhibited a bearish trend on the 4-hour chart, breaching a crucial bullish trend line with a support level at 1.2715. Notably, a sharp decline below the 50% Fibonacci retracement level, calculated from the upward movement between the 1.2611 swing low and the 1.2827 high, marked a significant development.
Compounding the downward momentum, the pair surpassed the 100 simple moving average (red, 4 hours), pointing towards potential further declines. The next pivotal support level looms at 1.2610, coinciding with the 200 simple moving average (green, 4 hours). A breach below the 1.2600 zone could trigger a sustained descent, with the subsequent major support standing at 1.2520. A break below this level might propel the pair towards a testing zone at 1.2450, and additional losses could potentially extend the decline to the 1.2300 zone.
Conversely, on the upside, immediate resistance is evident near the 1.2680 level, followed closely by a key hurdle at 1.2720. A decisive close above the 1.2720 zone has the potential to pave the way for further upward movement. Bulls aiming for higher ground may target 1.2800 as the next significant level of resistance. The technical landscape suggests a delicate balance, with market participants closely monitoring key support and resistance levels for potential shifts in the pair’s direction.
