The British pound gained around 40 pips on Monday, supported by a 0.37% drop in the U.S. dollar index. However, the move came on low trading volumes, signalling that major players were largely absent, which raises caution about the sustainability of the rise.
The pair is now eyeing 1.3631 as its immediate target. A break above this level could clear the way toward 1.3700, aligning with the upper boundary of a long-term 18-year descending channel. However, this area is also seen as a potential reversal point.
If the pair fails to hold gains and slips back under 1.3525, the outlook would shift bearish. This level coincides with the MACD line, and a confirmed breakdown could expose deeper targets at 1.3364 and 1.3253.
H4 Outlook
On the four-hour chart, price action is approaching 1.3631, while the Marlin oscillator is moving sideways, hinting at a possible pullback. The 1.3525 support remains critical on this timeframe as well, reinforced by the MACD line. A decisive move below it would mark a shift toward a downward trend.
For now, traders are waiting for the Federal Reserve’s policy decision tomorrow, which is likely to set the tone for the next major move in GBP/USD.
This analysis is for informational purposes only and does not constitute financial advice.
