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GBPUSD tests ascending trend line
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Stochastics and RSI indicate negative moves
GBPUSD plunged towards the medium-term ascending trend line with strong momentum, breaking the 1.2800 psychological level after the BoE’s decision to cut rates.
According to the technical oscillators, the stochastic is posting a bearish crossover within its %K and %D lines slightly above the oversold area, while the RSI is diving beneath the neutral threshold of 50.
More downside pressures could open the way for a test of the 1.2740 support ahead of the 200-day simple moving average (SMA) at 1.2650. A drop below this line would confirm the bearish scenario, hitting the 1.2610 barricade.
Alternatively, a bounce off the uptrend line could find immediate resistance at 1.2800 before turning traders’ attention to the 20-day SMA at 1.2890. Even higher, the one-year peak of 1.3045 may halt upside movements.
In summary, GBPUSD has maintained an upward trend and this should hold as long as it remains well above the 200-day SMA in the daily timeframe.
