To cancel the bearish scenario in GBPUSD, a breakdown of the level of 1.39065 is required

Paying attention to the 4-hour chart, you will notice that:

  • on Monday trading, the breakdown of the resistance level 1.3833 led to a significant increase in bullish sentiment, and the development of our first two alternative targets (1.3859 and 1.39065) ended at the end of the European session; also note that at the moment the quotes were very close to our third alternative target – 1.39385,
  • the GBPUSD rate was unable to gain a foothold above the mirror level 1.39065 for a long time, and today the bears seized the initiative.

Now let’s look at the indicators:

  • The currency rate is squeezed between the moving averages with periods of 55 and 34 (resistance levels 1.3893 and 1.38965) on the one hand and the average with a period of 144 (support level 1.3841) on the other, and at the moment it has practically merged with the average with a period of 89.
  • The MACD histogram is still in the negative area, but already slightly above its signal line, it began to move almost parallel to the time axis and is not giving clear signals at the moment.
  • Stochastic Oscillator is in the neutral zone and is giving a signal to sell the British Pound (GBP), as the% K line falls below the% D line.

Despite only one clear signal, we expect the bearish offensive to continue, with potential targets at 1.3833, 1.3802 and 1.3755.

Cancellation of the ‘bearish scenario’ will occur in case of a breakdown of the mirror level 1.39065, which may open the way to levels 1.3931, 1.3964 and 1.40025.

Resistance levels: 1.38775, 1.3893, 1.38965, 1.39065, 1.3931, 1.39525, 1.3964

Current price: 1.3872

Support levels: 1.38555, 1.3841, 1.3833, 1.3802, 1.3786, 1.3755, 1.3715, 1.3681

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