GBPUSD retraces lower and may find support at 1.2970 area. After an impulsive Bullish momentum, GBPUSD found resistance at 1.32 and pushed lower. Let’s check GBPUSD Technical Analysis for more levels and insights.
March 10, 2020, | AtoZ Markets – The extended period of Bullish pressure took GBPUSD to January’s high. After rejecting the 1.32 resistance area Bears push the price down. GBPUSD may finds support at 1.2970 area in the coming days.
Great Britain Pound rose against the United States Dollar on fear of the Federal Reserve will slash rates to 2015 lows. Marshall Gittler, Head of investment research, at BDSwiss Group, said, “There’s a lot of optimism about the impact of this week’s UK budget, which appears likely to be coordinated with a round of interest rate cuts.” He also added that “The rate cuts don’t necessarily have to be negative for sterling if the market believes that they’re likely to bring about faster-than-expected growth.”
Goldman Sachs predicted that the FED will cut the interest rate when policymaker will gather on March 17-18 and after that on April 28-29, the Fed may cut the rates on 50 basis points to a range of 0.0% – o.25%, which was seen in 2015.
GBPUSD Retraces Lower in a Strong Bullish Trend
GBPUSD has been quite impulsive and non-volatile with a Bullish trend. The price failed to break above 1.3200 and declined. The Bullish trend may sustain further after a retracement.
Image: GBPUSD 1 Hour Chart
According to the 1-hour chart, the price of GBPUSD is currently residing near the 1.3020 area. After rejecting the 1.320 resistance area, GBPUSD retraced lower quite well. The Bearish may decline further with the target of the 1.2970 area.
Moreover, the dynamic level of 20 EMA is residing above the current price, along with the Kijun line and the Tenkan line. The dynamic levels are supporting the price as resistance while progressing lower. On the other hand, the MACD indicator lines are below 0.00 level and the histogram volumes are also below 0.00 level but gradually squeezing higher. As a result, it indicates Bullish Divergence is in the making and Bulls may enter the market soon.
GBPUSD Bears are Temporary
According to the Daily chart, GBPUSD is currently trading at 1.3020 area while declining. GBPUSD was quite impulsive and non-volatile with the recent Bullish trend after rejecting the 1.2730 key level. The price found resistance at the 1.32o0 area and declined as a retracement. As per the current scenario, if GBPUSD can retrace down towards the 1.2970 area, the Bulls may intervene in the process. So, the price may start to climb higher again towards 1.3200.
Image: GBPUSD Daily Chart
Moreover, the dynamic level of 20 EMA is residing below the support level which is at 1.2970, along with the Kijun line and the Tenkan line. Additionally, the Chikou Span (Green Line) is intersecting the price candles. So, a break above the candles may lead the price higher with more Bullish confluence. The dynamic levels may work as strong support for further climb in the process.
To conclude, GBPUSD is currently declining and may reach the 1.2970 area. So, If Bulls have a strong daily close above 1.2970 area, the Bullish trend may continue higher with the target towards 1.3200.