- GBP/USD loses momentum and holds below the mid-1.2000s on Tuesday.
- The pair holds below the 50- and 100-hour EMAs with an oversold RSI condition.
- The immediate resistance level is seen at 1.2107; 1.2050 acts as an initial support level.
The GBP/USD pair extends its downside and trades in negative territory for the fifth consecutive week during the early European trading session on Tuesday. The sell-off of the pair is supported by the firmer US Dollar (USD) and the hawkish stance of the Federal Reserve (Fed). GBP/USD currently trades around 1.2066, losing 0.16% on the day.
Technically, GBP/USD holds below the 50- and 100-hour Exponential Moving Averages (EMAs) with a downward slope on the one-hour chart, which means further downside looks favorable.
The immediate resistance level for GBP/USD will emerge near the middle line of the Bollinger Band at 1.2107. The additional upside filter to watch is 1.2145 (the 50-hour EMA). The key barrier for the pair is located near the confluence of the upper boundary of the Bollinger Band and the 100-hour EMA at 1.2170. Further north, a psychological round mark at 1.2200 will be the next stop.
On the flip side, any decisive follow-through selling below the lower limit of the Bollinger Band at 1.2050 will see a drop to 1.2010 (a low of March 15). The next contention level is seen at 1.1965 (a low of February 16) en route to 1.1925 (a low of March 2).
It’s worth noting that the Relative Strength Index (RSI) holds in bearish territory below 50. However, the oversold RSI condition indicates that further consolidation cannot be ruled out before positioning for any near-term GBP/USD depreciation.
GBP/USD one-hour chart
