Conclusion for today’s GBPUSD technical analysis:
Price closing above ~1.24714 implies higher prices in GBPUSD.
GBPUSD (cable) technical analysis for today is presented on an intraday (6 hour) timeframe that covers over 19 months of price action. The major downtrend during this period is captured using a bearish price channel (tentative), along with the 50 and 200 moving average.
A double top chart pattern that confirmed on April 30, 2018 helped set in motion the current downtrend in the GBPUSD. A period of ranging price action is currently active since August 16, 2018 to current date. This is presented in this analysis as the formation of a broadening formation that has so far included a confirmed, complex, head and shoulders top pattern.
Price action successfully tested the lower boundary of the broadening formation at ~1.20215 on August 09, 2019, and has been followed by an upward swing in price.
The GBPUSD currently trading above its 50 moving average whose slope is to the upside does imply a bullish bias. However, the downward sloping 200 moving average suggests bearish momentum is currently not over. Price closing above the former average (50) is expected to target the latter (200) at the minimum.
It is also important to note that the 200 moving average coincides with resistance price levels in the Cable between ~1.24714 and 1.23740. This increases the chance of price targeting this region where a challenge to a new uptrend is expected.
An upper target region for price upon closing above the upper boundary of resistance at ~1.24714 is the upper boundary of the channel. This is ~1.27848. The upper boundary of the broadening formation at ~1.34750 is used as a higher target for the GBPUSD if price closes above the upper boundary of the channel.
Price closing below ~1.20215 invalidates the bullish analysis.
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