GBPUSD recently lost momentum as it approached the uptrend line, signaling a potential shift in the market. Although the pair broke the long-term ascending trendline, it is currently trading within a narrow range after failing to sustain the bearish trend. However, there is a significant resistance level at 1.3000, which could dictate the future direction of the pair.
Technical indicators such as the stochastic show upward movement with strong momentum, while the RSI remains flat below the neutral level of 50. This indicates a sideways movement in the market in the near term.
If GBPUSD manages to recover from its recent losses and break above the critical level of 1.3000, it could retest the 20-day simple moving average at 1.3020, followed by the 1.3100 level. On the other hand, a drop below the support level of 1.2900 could lead to a test of the 200-day SMA at 1.2810, with further support at 1.2610-1.2670.
In summary, GBPUSD has been consolidating in the short term and has been on a downward trend since retreating from its two-and-a-half-year high. If selling pressure persists and the pair breaks below the 200-day SMA, the outlook could turn bearish.
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