- GBP/USD experiences strength due to the possibility of interest rate hikes by the BoE.
- 55-day EMA acts as the immediate support aligned to the weekly low at 1.2710.
- MACD suggests tepid momentum, reflecting mixed sentiments of GBP/USD traders.
At the time of writing on Wednesday during the Asian session, GBP/USD is trading higher at the 23.6% Fibonacci retracement at 1.2740. The likelihood of interest rate increases at the Bank of England (BoE) meeting in September supports the pair. Prior to the release later in the day of the preliminary S&P Global/CIPS Composite PMIs for August in the United Kingdom (UK), market investors become cautious.
Here's what I analyzed on #GBPUSD (3 PAGES)
It's simple. I went to the H1, identified the swing range, used my fib retrace went tool to mark from the high to the low. Went to m15 to check the 50% 👇🏻 pic.twitter.com/R8Kvl34Jsq
— Cliff Godson◻️ (@cliff_godson) August 23, 2023
The immediate support is the 55-day Exponential Moving Average (EMA) at 1.2728, followed by the weekly low at 1.2710. If the former is decisively broken, the GBP/USD sellers may be able to move the pair toward its monthly low around 1.2616.
On the upside, the GBP/USD pair could face a formidable challenge around the 21-day EMA at 1.2755 as it appears to be a key barrier. An upside breakout could lead the pair to explore the region around the 1.2800 psychological level aligned to 38.2% Fibo at 1.2817.
— Investing.com UK 🇬🇧 (@uk_investing) August 23, 2023
The Moving Average Convergence Divergence (MACD) line, which continues below the centerline while simultaneously exhibiting convergence below the signal line, signifies lackluster momentum and reflects the conflicted emotions of GBP/USD traders. The 14-day Relative Strength Index (RSI) is still below 50, indicating that the pair is still bearish.