GBP/USD Price Analysis: Remains confined in a narrow trading range, below 1.2400 mark
- GBP/USD continued with its range-bound price action for the third straight session.
- The set-up seems tilted in favour of bullish traders, albeit warrants some caution.
The GBP/USD pair extended its sideways consolidative price action through the mid-European session on Wednesday and remained capped below the key 1.2500 psychological mark.
The recent subdued/range-bound trading moves now seemed to constitute towards the formation of a rectangle pattern, indicating a brief pause before the next leg of a directional move.
Given the pair's recent strong recovery from 35-year lows, the rectangle might still be categorized as a continuation pattern and support prospects for a further near-term appreciating move.
Meanwhile, oscillators on hourly charts on hourly charts maintained their bullish bias and have recovered from the negative territory on the daily chart, reinforcing the constructive outlook.
However, it will be prudent to wait for a sustained break through the trading range, and a subsequent strength beyond the key 1.2500 psychological mark before placing fresh bullish bets.
On the flip side, the lower end of the mentioned range coincides with 100-hour SMA, which should now act as a key pivotal point for trades and if broken, might prompt some aggressive selling.
GBP/USD 1-hourly chart
Technical levels to watch