- GBP/USD has been limited below 1.2400 on Monday.
- Momentum indicators signal possible bearish momentum in GBP/USD.
- Immediate support appears around the June lows, followed by the psychological level of 1.2350.
GBP/USD appeared to break a two-day losing streak early in the day, but later turned lower and fell towards 1.2370 at the start of the European session on Monday.
Investors expect the Bank of England (BoE) to raise interest rates by 25 basis points at its next meeting on Thursday. On the other hand, the United States Federal Reserve (Fed) is expected to maintain its current interest rate on Wednesday.
Technically, GBP/USD could face a challenge around the 9-day EMA at 1.2463, followed by the 12-day EMA at 1.2488 level.
A break above the psychological level of 1.2500 could lead the pair to explore the 23.6% Fibonacci retracement zone at 1.2560.
On the other hand, immediate support for the GBP/USD pair appears around the June lows at 1.2368, followed by the psychological level of 1.2350.
If the bearish sentiment puts pressure, the pair could approach the next support level near the lows seen in May at 1.2308, followed by the round level of 1.2300.
The MACD line remains below the center line and shows divergence below the signal line. This setup suggests possible bearish momentum in the market, which can be considered as a sign that the recent downtrend may continue.
GBP/USD traders will likely watch the 14-day Relative Strength Index (RSI), which indicates short-term bearish momentum, as it is below the 50 level.
GBP/USD daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
