GBP/USD traded higher on Tuesday, after it hit support near the 1.3505 barrier and the upside support line drawn from the low of January 28th. As long as the rate stays above that line, we will maintain a positive stance.
If the bulls are willing to stay in the driver’s seat, we could soon see them overcoming the 1.3615 barrier, thereby confirming a forthcoming higher high on both the 4-hour and daily charts. Such a move could initially pave the way towards the peak of January 20th, at 1.3660, or the 1.3690 zone, marked by the high of January 17th. If the bulls are not willing to stop there, then we could see them climbing towards the high of January 13th, at 1.3750.
Shifting attention to our short-term oscillators, we see that the RSI lies above 50 and points up, while the MACD runs slightly above both its zero and trigger lines, pointing up as well. Both indicators detect upside speed and support the notion for further advances.
In order to abandon the bearish case, we would like to see a clear dip below 1.3490. This will not only confirm a forthcoming lower low, but also the break below the upside line taken from the low of January 28th. The bears could then aim for the 1.3435 barrier, marked by the low of February 1st, where another break could extend the fall towards 1.3395 zone, marked by the low of January 31st. Slightly lower there is the 1.3365 hurdle, defined as a support by the lows of January 27th and 28th, which could also get tested.
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