The recent rebound from multi-year lows has stalled today. The RSI has failed to continue its rise and paused just below 50, suggesting upside momentum has weakened. GBPUSD has staged a steady rally from a low of 1.3834 reached earlier this week (February 29) and rose steadily all week to reach a high of 1.4193 on Thursday. The key level at 1.4100 is now a target and a break below this would bring 1.4000 into sight. Failure to support at this level would indicate that this week’s corrective move has topped at 1.4193 and this would strengthen the bearish outlook. To the upside, resistance lies at 1.4248. This is where the kijun-sen line converges with the 50% Fibonacci retracement of the downleg from 1.4667 to 1.3834.
Looking at the daily chart, the moving averages are negatively aligned, with the 50-day moving average below the 100 and 200-day moving averages, supporting a bearish bias. MACD is trending down and is below zero, also supporting a bearish outlook. Meanwhile the tenkan-sen line is below the kijun-sen line, and the market is below the Ichimoku cloud, which highlights the bearish market structure.
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