The GBP/USD pair is currently facing a downward trend as the US Dollar continues to gain strength against the Pound Sterling. The recent positive US trade and labor data have contributed to the Dollar’s rise, causing the GBP/USD to drop by 0.30% and struggle below the key resistance level of 1.2550, which is the 200-day moving average (DMA).
The Relative Strength Index (RSI) indicator is showing bearish momentum, indicating that sellers are currently dominating the market. If the GBP/USD fails to recover above the 1.2500 level, it is likely to continue its downward trajectory and potentially test the recent low of 1.2299, which was reached on April 22.
In order for the GBP/USD to reverse its current trend, buyers will need to break above the 200-DMA at 1.2550 and then aim to surpass the resistance levels at 1.2569 and 1.2613, which correspond to the 50-DMA. Further upside potential can be seen if the pair manages to move past the 100-DMA at 1.2644.
Overall, the technical outlook for the GBP/USD pair remains neutral to bearish, with momentum favoring sellers. It will be crucial for buyers to reclaim key resistance levels in order to potentially shift the direction of the pair and pave the way for further gains in the future. As the US Dollar continues to show strength, the GBP/USD may face further challenges in the near term.
