After a prolonged downtrend, which started on 17th of April, GBP/USD could potentially see a sign of recovery, at least in the short run. Judging by the 4-hour chart, the pair started creating higher lows, which are supported by short-term upside support line taken from the June 28th low. This suggests that the pair could break the key resistance of 1.3215, and may continue correcting higher for a while more.
For now, looking at the short-term picture, we will stick to the upside potential and aim for a break of the 1.3215 level. Further acceleration in the rate could lead to a test of the round 1.3300 zone, which acted as a good area of resistance recently, on the 22nd and 26th of June. This is where GBP/USD could stall for a while, as the bulls and the bears could start battling it out over who will be dictating the rules in the near-term. If the bulls take charge again and manage to break the key 1.3300 obstacle, this could signal a short-term trend reversal to the upside and could lead to a test of the 1.3450 hurdle that played out as a god resistance in the first half of June.
Our oscillators are currently in support of our upside idea, as the RSI is above 50 and pointing higher, and the MACD is not only above zero, but also above the trigger line.
Alternatively, if the aforementioned short-term upside support line breaks, then a drop towards the initial good area of support at around 1.3090, could become a reality. If this area is not able to withhold the rate from dropping further, then we could see a test of the lowest point of June near the 1.3050 mark. Slightly below that lies the important psychological 1.3000 level, which could get a touch as well.
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