- After the previous session’s modest pullback, the pair regained some traction on Tuesday and climbed to session tops – around the 1.2270 region – in the last hour.
- The pair found decent support ahead of the 1.2200 round figure mark, which nears 100-hour SMA and should now act as a key pivotal point for short-term traders.
Technical indicators on hourly charts maintained their bullish bias and have just started gaining positive momentum on the daily chart, supporting prospects for an extension of the recent recovery move from the vicinity of the key 1.20 psychological mark – or yearly lows.
On the contrary, the pair now seemed to be in the process of forming a bearish head & shoulders pattern on hourly charts, which will be confirmed following a decisive breakthrough the neckline support near the mentioned handle.
However, a sustained strength beyond the 1.2270-75 region will negate any near-term bearish bias and set the stage for a move beyond the 1.2300 round figure mark towards testing the pair’s next major hurdle near the 1.2330-35 region.
Meanwhile, weakness below the 1.2200 handle is likely to accelerate the slide further towards the 1.2170 horizontal support en-route the 1.2125-20 region – nearing the bearish pattern target on the downside.
GBP/USD 1-hourly chart