August 25, 2022 12:06 AM ET
The GBP/USD pair is clinging to slight gains around 1.1820 after breaking through the short-term bearish channel ahead of Thursday's opening in London. As a result, the cable pair is halting its weekly gains after falling to its lowest levels since March 2020.
In addition to the channel breakout, bullish MACD signals and the upward sloping RSI (14), which is not overbought, are also supporting the bullish bias of the GBP/USD pair.
As a result, the quote remains poised to challenge the weekly high around 1.1880, the break of which could quickly propel it toward the 50% Fibonacci retracement of the August 01-23 decline near 1.2000. However, the 1.1900 round number could act as a buffer during the expected rise.
It should be noted, however, that the 200-SMA level around 1.2020 appears to be an important hurdle for GBP/USD bulls to clear, as a sharp rise above this level could give buyers control.
Alternatively, pullback moves must break back below the 1.1780 support confluence, including the previous resistance line of the indicated channel, now support, as well as the two-day-old ascending trend line.
Then, a southward descent to the recently hit multi-month low near 1.1720 appears imminent.
A sustained trade below 1.1720, on the other hand, will not hesitate to drag the GBP/USD pair toward the aforementioned channel support line, which is near 1.1590 at the time of writing.