GBP/USD traded lower during the European morning Thursday, breaking below the 1.3030 support (now turned into resistance) level, and at the time of writing, it looks to be heading towards the psychological round figure of 1.3000. Overall, the pair remains contained between the upside support line drawn from the low of March 10th and the downside resistance one taken from the high of March 13th, that way printing a triangle pattern. Thus, we will stay flat for now and wait for a break out of the formation.
A clear dip below 1.3000 would also bring Cable below the aforementioned upside line and may give sellers the green light to push the battle lower, perhaps towards the 1.2955 area, defined by the low of March 10th. The rate could rebound somewhat from that zone, but if the bears are not willing to let it return back above 1.3000, we may see another negative leg, which could lead to a break below 1.2955. Such a move could carry more bearish implications, perhaps paving the way towards the 1.2895 obstacle, marked by the low of February 19th.
Our short-term oscillators detect negative momentum and support somewhat the case for further declines. The RSI, already below 50, has turned down again and now looks to be heading towards 30. The MACD lies below both its zero and trigger lines, pointing down as well.
Alternatively, if the bears fail to break the 1.3000 psychological area and the rate rebounds, this could suggest that buyers are entering the action. However, we will start examining the bullish case only if the rate emerges above 1.3120. Such a move would confirm the upside exit out of the aforementioned triangle, as well as a forthcoming higher high on the 4-hour chart. We may then experience extensions towards the 1.3190 zone, which is near the highs of April 3rd and 4th, the break of which may allow the bulls to put the 1.3270 barrier on their radars. That level stopped the rate from moving higher on March 27th.
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