FX.co ★ Technical analysis of GBP/USD for February 02, 2021

Overview :

A trend in the GBP/USD pair was argumentative as it was trading in a narrow sideways channel, the market showed signs of instability.

Amid the previous events, the price is still moving between the levels of 1.3758 and 0.3609.

Resistance and support are seen at the levels of 1.3758 (also, the double top is already set at the point of 1.3758 ) and 0.3609 respectively.

Therefore, it is recommended to be cautious while placing orders in this area. So, we need to wait until the sideways channel has completed.

The current price is seen at 1.3683 which represents a key level today.

On the H4 chart :

The GBP/USD pair will continue to rise from the level of 1.3644.

The support is found at the level of 1.3644, which represents the 78% Fibonacci retracement level in the H4 time frame.

Overall, we still prefer the bullish scenario, which suggests that the pair will stay above the zone of 1.3609 today.

The price is likely to form a double bottom. Today, the major support is seen at 1.3644, while immediate resistance is seen at 1.3725.

Accordingly, the GBP/USD pair is showing signs of strength following a breakout of a high at 1.3638.

So, buy above the level of 1.3638 with the first target at 1.3725 in order to test the daily resistance 1 and move further to 1.3758.

Also, the level of 1.3758 is a good place to take profit because it will form a double top.

The pair is still in an uptrend; for that we expect the GBP/USD pair to climb from 1.3638 to 1.3808 (1.3808 will be our last target today).

At the same time, in case a reversal takes place and the GBP/USD pair breaks through the support level of 1.3609, a further decline to 1.3405 can occur, which would indicate a bearish market.

The market is still in an uptrend. We still prefer the bullish scenario. Equally important, the RSI is still calling for a strong bullish market and the current price is below the moving average 100.