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GBP/USD Price Analysis: Consolidating in a contracting triangle

  • GBP/USD is consolidating in a narrowing price range. 
  • A range breakdown looks likely as Monday's candle indicates bull fatigue.

GBP/USD is lacking a clear directional bias for the second day and is trapped inside a symmetrical triangle or a contracting price range, as seen on the 15-minute chart. 

An upside breakout would open the doors to re-test and possible break above the March 27 high of 1.2485. Alternatively, a range breakdown would imply an end of the bounce from the March 20 low of 1.1410 and could yield a drop to the hourly chart horizontal support at 1.2305. 

The relative strength index on the 4-hour chart has dived out of an ascending trendline rising from March 23 lows. Meanwhile, Monday's inside day Doji candle is indicating bull fatigue. 

As a result, the pair is more likely to suffer a symmetrical triangle breakdown. At press time, GBP/USD is trading at 1.2370, representing moderate losses on the day. 

Hourly chart

Trend: Neutral-to-bearish

Technical levels

 

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