- GBP / USD fails to rally 1.40 amid firmer risk tone.
- The powerful resistance is at 1.4014 while the RSI remains bullish.
- GBP / USD awaits final UK PMI amid budget and vaccine optimism.
GBP / USD has fallen back to the region of daily lows near the 1.3950 level after failing to regain the 1.40 region during Monday’s Asian session amid upbeat market sentiment.
Investors celebrate a positive start to March as bond markets seek to stabilize after last week’s slide, supporting risky currencies such as the British pound.
Furthermore, hopes for additional budgetary stimulus and the successful launch of the Covid vaccine in the UK help the pair’s recovery.
The bulls are now awaiting the release of the final UK Manufacturing PMI and US ISM Manufacturing PMI for further trading opportunities, while risk sentiment remains favorable.
From a short term perspective, the pair is gradually approaching 1.4000, above which critical resistance at 1.4014 could be challenged. That level is the convergence of the 50 and 200 hourly simple moving averages.
Keep in mind that this convergence would point to an imminent death crossover on the 1-hour chart. The bearish formation will be validated once the 50 SMA breaks below the 200 SMA.
The pair could then stop its recovery momentum and turn towards the 21 SMA at 1.3959. Further declines appear supported as the RSI is still holding above the midline, currently at 53.
GBP / USD 1 hour chart
GBP / USD technical levels
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