Resistance And Support Levels
GBP/USD is approaching resistance at 1.3400 after reaching around 1.3370 in Asian trading hours. The 14-day RSI is over 70, indicating potential overbought conditions and a possibility for a downside correction.
The pair has maintained a bullish trend since April 8, trading above the nine-day Exponential Moving Average. Continued momentum could push it towards the ascending channel’s upper boundary near 1.3480.
Initial resistance lies at 1.3400, then 1.3434, a level not crossed since September 2024. Support is around 1.3194 at the nine-day EMA, with further support at the channel’s lower boundary near 1.3150.
Falling below these levels may weaken the bullish stance, with the 50-day EMA at 1.2906 offering further support. A further drop might pull the pair to 1.2577 or even 1.2249, lows from March and February respectively.
The British Pound showed varying performance today, with a 1.03% rise against the US Dollar. The currency exhibited changes against others, including a 1.03% rise against the Euro and a 0.96% increase against the Swiss Franc.
Potential Corrections And Market Sentiment
We’re seeing the British Pound testing familiar territory, with GBP/USD inching ever closer to the 1.3400 barrier—territory it hasn’t consistently occupied in some time. Earlier movement in Asian hours brought it around 1.3370, brushing just under this resistance. That’s not surprising, considering the momentum it’s carried since early April. RSI sits above 70 on the 14-day frame—traditionally a marker for stretched buying conditions. These levels suggest that traders might be getting a little ahead of themselves.
Historically, when RSI breaches that threshold, the market tends to correct itself, often opting for a retracement. The rally has been persistent, supported by price action holding comfortably over the nine-day EMA. While that trend stays intact, there’s a case for higher levels being tested—possibly pressing against the rising channel’s ceiling, which rests around 1.3480.
Yet it isn’t just about the hopeful upside. Immediate hurdles are well laid out: 1.3400, for one, and not far beyond is 1.3434—a mark we haven’t seen broken since last September. Traders often watch those levels closely, and some may have orders clustered nearby. Failure to pierce those could lead to fading enthusiasm among momentum traders.
If weakening kicks in, focus shifts to the first support layer at the nine-day EMA, near 1.3194. Beyond that lies the lower range of the ascending channel around 1.3150—which, if breached with volume, could be viewed less as a pullback and more as a change in tone. Should the pressure persist, the 50-day EMA currently around 1.2906 becomes the more structurally important benchmark. A drop beneath that zone would erode the bullish technical posture, possibly steering focus toward Q1’s deeper support zones around 1.2577 or, more boldly, 1.2249.
Monday’s jump of just over 1% against the Dollar is eye-catching, but arguably more so are the broad-based gains against other majors. The Pound moved an equal 1.03% versus the Euro and 0.96% up against the Swiss Franc. That suggests this isn’t an isolated Dollar move—at least not entirely.
For those reacting to these shifts in underlying volatility, it’ll be worth watching how strength in Sterling holds up once RSI mean-reverts. Especially if macro headlines thin out, there’s a risk of thin liquidity exaggerating moves in either direction. Technically, until we see a firm rejection at current resistance or a break below the short-term moving averages, bullish setups remain intact on the daily view. Nonetheless, an increasingly stretched momentum backdrop requires us to be flexible with positioning and to keep stop losses tighter than usual while volatility remains elevated.
