- Recent drop of 156 pips from the current 52-week high of 1.2848 has not damaged GBP/USD minor uptrend.
- Price actions so far have been trading above upward sloping 13-day moving average now acting as support at 1.2630.
- Short-term upside momentum seems to have resurfaced as indicated by the hourly RSI oscillator.
The ongoing medium-term uptrend phase of GBP/USD in place since the 26 September 2022 low of 1.0359 has hit a current 52-week high of 1.2848 last Friday, 16 June.
In the past week, it has declined by 156 pips (-1.22%) to print an intraday low of 1.2691 on Wednesday, 21 June ahead of today’s Bank of England’s monetary policy decision.
The medium-term uptrend remains intact with major resistance at 1.3360
Fig 1: GBP/USD medium-term trend as of 22 Jun 2023 (Source: TradingView, click to enlarge chart)
The weakness seen in the price actions of the GBP/USD in the past two days has not damaged the minor uptrend phase in place since the 7 June 2023 low of 1.2395.
It has continued to evolve within a minor ascending channel (see 1-hour chart) and traded above an upward-sloping 13-day moving average.
A resurgence of short-term upside momentum
Fig 2: GBP/USD minor short-term trend as of 22 Jun 2023 (Source: TradingView, click to enlarge chart)
The 1-hour RSI oscillator has just managed to form a “higher low” after it hit its oversold zone on Wednesday, 21 June which indicates that short-term upside momentum may have resurfaced.
Watch the 1.2630 key short-term pivotal support with next resistances coming in at 1.2980 and 1.3110 (upper boundary of the minor ascending channel, congestion area of 14 March/19 April 2022 & 76.4% Fibonacci retracement of the prior medium-term down move from 13 January 2022 high to 26 September 2022 low, see daily chart).
On the other hand, a break below 1.2630 negates the bullish tone to expose the key medium-term support of 1.2450.
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Kelvin Wong