GBP/USD moved past 100-SMA and 1.19000 level– will it reverse or continue to rise?
GBP/USD Technical Analysis
The H4 Chart of GBP/USD shows that the currency pair has just crossed above the upper line of the descending channel and 100-Day Simple Moving Average. However, the upper band of Bollinger bands right above the 100-Day SMA is also limiting the upside pressure. Any break to the upper band of Bollinger band would reverse the rising trend, and the price will start to decline.
Meanwhile, the technical indicators suggest that the price might keep on rising for the next few hours. The Moving Average Convergence & Divergence Indicator histograms are fading from the negative territory and are about to enter the positive territory above the zero line. It suggests that the price might keep on rising for a few hours. Additionally, the Relative Strength Index (RSI) close to the overbought level also suggests that prices have some upside potential left before reversal. Whereas the Stochastic Oscillator has already reached the overbought territory and suggests, the price will reverse sooner than expected.
However, if the buyers keep on pushing, they would face first resistance at 1.20958. Any break above this level would push the prices towards the second resistance at 200-Day Simple Moving Average.
On the other hand, any break above the upper Bollinger band would reverse the price course to the downside towards the first support at 1.19938. Any break below this level will trigger the next support level at 1.19390.
Overall, the technical analysis suggests that this sudden rise in the previous session was due to trend correction. The idea is to wait for the price to cut the upper Bollinger band and 1.20384 level before entering the long position.
Daily Technical Levels
Pivot Point: 1.1899