GBP/USD Outlook: Falls under 1.3400 following a retreat from the nine-day EMA
GBP/USD Continues Downward Trend for Third Day
During early trading hours in Europe on Thursday, GBP/USD declined for a third consecutive session, hovering near 1.3380. The short-term outlook remains slightly negative, as the pair stays beneath both the falling nine-day Exponential Moving Average (EMA) and the now-level 50-day EMA. This pattern suggests that upward momentum is weakening, particularly after the pair was rejected from the mid-1.36 range.
Technical Indicators Point to Further Weakness
Analysis of the daily chart highlights a strengthening bearish trend, with the currency pair retreating from the upper edge of its downward channel. The 14-day Relative Strength Index (RSI) is positioned just below 40, indicating ongoing selling pressure rather than an oversold market, and emphasizing the recent pattern of lower daily highs.
Key Support and Resistance Levels
GBP/USD may continue to slide, with initial support found at the three-month low of 1.3253, last seen on December 3. Should losses deepen, the pair could approach the lower boundary of the descending channel near 1.3140, and potentially test the 11-month low at 1.3010.
On the other hand, immediate resistance is located at the nine-day EMA of 1.3414, which aligns with the upper limit of the descending channel. A move above this level could shift the outlook to bullish, allowing GBP/USD to challenge the 50-day EMA at 1.3482. Sustained upward momentum might see the pair target 1.3869, the highest level since September 2021, which was reached on January 27.
Note: This article was updated on March 12 at 08:00 GMT to clarify that the events described occurred during Thursday's European session.
GBP/USD: Daily Chart
Technical analysis for this report was assisted by AI tools.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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