The GBPUSD currency pair has failed to break below the rising trendline on the 4-hour chart, instead extending its upside move that originated from the 1.2299 low on April 22nd. The rally carried the pair as high as 1.2860 before encountering resistance.
Consolidation Phase Underway
The subsequent pullback from the 1.2860 high suggests that a consolidation phase within the broader uptrend is currently underway. Another leg lower toward the rising 4-hour trendline support appears likely over the coming days as the pair digests its recent gains.However, as long as this trendline support holds on a closing basis, the overall technical bias will remain tilted to the upside, with the potential for a resumption of the uptrend after the current consolidation period.
Key Resistance Levels
In the near-term, the first level of resistance to watch on the topside is the 1.2825 area. A breakout above this level could potentially see the GBPUSD rally to retest the 1.2860 previous high resistance.If buyers can push the pair above 1.2860, the next key target would be the 1.2900 area.
Key Support Levels
While the technical outlook remains constructive, traders will want to keep a close eye on the 1.2775 area as initial support. A breakdown below this level could see the GBPUSD retrace back toward the rising 4-hour trendline support.A move below this trendline would be a significant technical event, likely opening the door for a deeper pullback toward the 1.2670 support.
Levels to Watch
The key levels to watch in the GBPUSD are the 1.2825 and 1.2860 resistance levels, along with the 1.2775 support, the rising 4-hour trendline support, and the 1.2670 support area.
As long as the pair remains above the rising trendline, the overall technical bias will remain tilted to the upside, with the potential for a continuation move toward the 1.2900 level after the current consolidation.
The GBPUSD uptrend shows resilience despite the recent pullback, with the pair holding above key trendline support. While further near-term consolidation appears likely, the path of least resistance remains skewed to the upside as long as this trendline holds.