The GBPUSD pair started its bullish correction after hitting the support at 1.21987, low of 10th October 2019. The bullish rally was capped by the critical resistance level at 1.35095. Breaking above that resistance level might be tough for the cable bulls since we have plenty of resistive candles. However, a daily closing of the price above 1.35095 might refuel the cable bulls. Eventually, the GBPUSD pair might target the next critical resistance level at 1.37593. To clear the resistance at 1.37593, we might need to see a settlement in the current Brexit drama. Investors are cautiously waiting to get a clear clue regarding this issue.
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On the downside, the pair has already rejected the 38.2% Fibonacci retracement level at 1.31414. The bearish retracement level was drawn from the high of 12 December 2019 to the low of 23 December 2019. If the bears manage to retain control of this market, the price of GBPUSD might fall towards the next support at 1.30543. This level might offer temporary support but a clear break of this level might result in a sharp fall. Eventually, the GBPUSD bears might try to take out the support at 1.29061 to establish fresh selling pressure. Considering all the issues, the overall bias for the GBPUSD pair is slightly bearish.Download our latest quarterly market outlook for our longer-term trade ideas.
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