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Bulls target 1.3000 amid bullish technical setup

GBP / USD is building on Friday’s strong recovery from levels below 1.2900 as the bulls hold out hope for some positive developments following a new round of Brexit negotiations likely to take place between the EU chief negotiator, Michel Barnier, and his British counterpart David Frost.

From a short-term technical perspective, the pair has confirmed a breakout of the descending triangle on the 1 hour chart, opening the doors for a move higher towards 1.3100.

On its way up the price will face powerful resistance at 1.2960, the confluence of the horizontal 200 hour moving average and the downward sloping 100 hour moving average.

The RSI on the 1 hour chart remains firm within the bullish territory, currently at 60.23 points, suggesting that there is room for a further rally.

A sustained move above the aforementioned barrier is needed to make another attempt towards the 1.3000 level. A break above which would target the October 14 high of 1.3064.

On the other hand, a strong support at 1.2925 will support immediate declines. That level is the confluence of the 21 and 50 hour moving averages.

Acceptance below this last level would once again bring into play the resistance of the downtrend line, now converted to support, at 1.2913.

GBP / USD 1 hour chart


Credits: Forex Street

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