The GBPUSD currency pair has made an important technical breakthrough by pushing above a falling trendline on the 4-hour chart. This development suggests that the prior downside move from the 1.2893 high may have already completed at the 1.2539 low.
With the break of this key resistance, the path has been cleared for further GBPUSD buying in the coming days and weeks. The first upside target in focus is the 1.2800 handle. If the bulls can sustain momentum above 1.2800, it could open the way to challenge the previous 1.2893 high next.
The newfound bullish outlook for GBPUSD will remain in play as long as the currency pair can hold above the rising trendline which now represents the key support level on the 4-hour timeframe. Only a break below this newly formed rising trendline would mark a bearish reversal signal and expose the 1.2400 area once again.
GBPUSD traders will be closely watching price action around the 1.2800 and 1.2893 resistance levels in the sessions ahead. The pair’s ability (or inability) to clear these hurdles will help determine if the longer-term bullish outlook can remain intact or if the bears will regain control.
For now, the technical breakout above the falling trendline resistance puts the currency in a more favorable position to extend its recovery off the 1.2539 lows. But the bulls will need to maintain momentum to capitalize on the shift in market structure.