FX.co ★ Technical analysis of GBP/USD for October 05, 2022

The GBP/USD pair moved higher and closed the day in positive area near the price of 1.1214. It also rose a little, having risen to the level of 1.1459. On the hourly chart, the GBP/USD pair is still testing resistance (1.1459) - the moving average line MA (100) H1 (1.1214). The GBP/USD pair continues to push higher toward 1.1329 during the American trading hours on Monday.

The dollar stays under constant selling pressure after the ISM Manufacturing PMI survey showed price pressures continued to ease in August. Range trading continues in the GBP/USD pair and intraday bias stays upwards at this point. The GBP/USD pair was trading around the area of 1.1329 a week ago. Today, the level of 1.1329 represents a daily pivot point in the H1 time frame.

The pair has already formed minor resistance at 1.1459 and the strong resistance is seen at the level of 1.1500 because it represents the daily resistance 2.

On the upside, above 1.1459 minor resistance will target 1.1500 resistance first. Break there will target channel resistance at 1.1500. It should be noted that volatility is very high for that the GBP/USD pair is still moving between 1.1329 and 1.1500 in coming hours.

Furthermore, the price has been set above the strong support at the levels of 1.1033 and 1.1214 , which coincides with the 61.8% and 78% Fibonacci retracement level respectively.

Further recovery should motivate the pair to challenge recent highs around 1.1459 to allow for extra gains to, initially, the interim hurdle at the 50-day EMA at 1.0207. The market is indicating a bullish opportunity above the above-mentioned support levels, for that the bullish outlook remains the same as long as the 50 EMA is headed to the upside Bias will be back on the upside for retesting 1.1500 high. On the upside, above 1.1500 will resume the rebound to 1.1550 resistance turned support.

On the downside : The price is in a bearish channel now. Amid the previous events, the pair is still in an uptrend. On the one-hour chart, the GBP/USD is still below the MA 50H4 line.

Based on the foregoing, it is probably worth sticking to the south direction in trading, and while the GBP/USD pair remains below MA 50 H1, it may be necessary to look for entry points to sell at the end of the correction. Areak of 1.1214 minor support will bring retest of 1.1150 and 1.1033 low instead.