- GBP / USD stopped its positive momentum near a two-month-old ascending resistance channel.
- Any subsequent decline could still be seen as a buying opportunity near 1.3100.
- A sustained move above the channel will set the stage for additional short-term gains.
The pair GBP/USD it stopped its recent bullish trajectory to fresh two-month highs and witnessed a modest intraday pullback from the 1.3310-15 zone. The aforementioned region marks the upper limit of an upward sloping channel that has been running since mid-September and should now act as a hotspot for short-term traders.
The GBP / USD pair fell to new session lows, around the 1.3230 region in the past hour, although any subsequent decline is more likely to attract some buying closer to 1.3200. This should help limit the decline near the 1.3180-75 resistance breakout point, which represents the 61.8% Fibonacci level of the 1.3482-1.2676 decline.
That said, some follow-up selling below the 1.3150-40 horizontal level will negate the prospects for any further appreciation movement, instead prompting some technical selling. GBP / USD could accelerate the corrective decline towards the 1.3100 level en route to 50% Fibonacci level, around the 1.3075 area.
On the other hand, 1.3300 now appears to limit the immediate upside and is closely followed by trend line resistance. A sustained force above will be seen as a new trigger for the bulls and will pave the way for a further appreciation move towards resistance near the 1.3385 level.
Daily chart
Credits: Forex Street
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