- The early uptick to levels beyond the 1.1700 mark runs out of the steam rather quickly.
- GBP/USD’s inability to sustain at higher levels points to the emergence of fresh selling.
- Still oversold conditions on the daily chart warrant some caution for aggressive bearish traders.
The GBP/USD pair failed to capitalize on the early uptick to levels beyond the 1.1700 round-figure mark and has now weakened back below the 1.1600 level, albeit has still managed to hold above the Asian session swing lows.
Given that the pair on Friday struggled to find acceptance above 23.6% Fibonacci level of the 1.3191-1.1412 recent slump, a subsequent rejection near 100-hour SMA points to the emergence of some fresh selling pressure.
Meanwhile, technical indicators on hourly charts maintained their bearish bias and add credence to the bearish outlook amid mounting fears over the economic fallout from the coronavirus pandemic/an imminent global recession.
However, oscillators on the daily chart are yet to recover from the oversold territory and warrant some caution for aggressive bearish traders, making it prudent to wait for a sustained break below the key 1.1500 psychological mark.
On the flip side, any attempted positive move back above the 1.1700 mark might still be seen as an opportunity to initiate some fresh bearish positions and seems more likely to remain capped near the 1.1765 region (100-hour SMA).
GBP/USD 1-hourly chart
Technical levels to watch