GBPUSD broke above a key resistance level of 1.4500 on Wednesday to reach a one-month high of 1.4648. This is close to the 50% Fibonacci level of the retracement from 1.5238 to 1.4078 (December to January drop). This level lies at 1.4657.
For a shift to a bullish bias, strong upside momentum is needed, otherwise the market may find it a challenge to break above this strong resistance level at the 50% Fibonacci. The recent rally could just be a corrective move of the sharp decline from 1.5238. RSI is not too far above the 50 level which demarcates the bullish and bearish territory, so upside momentum is not that strong at the moment. Prices have already started pulling back today. Immediate support is provided by the area between the key 1.45 level and the 38.2% Fibonacci.
Meanwhile the 100 and 200-day moving averages are sloping downwards and the market is below them, which highlights a bearish market structure.
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