September 20, 2022 01:12 AM ET
The GBP/USD currency pair is trying to extend the previous day's bounce from the three-month support line, retreating to 1.1420 at Tuesday's London open. Even so, a bullish candle formation and an oversold RSI (14) are teasing cable buyers ahead of key weekly events.
The GBP/USD pair bounced off the June downtrend support line during the previous day and formed a Dragonfly Doji at the lowest levels since 1985. The same with oversold RSI conditions, keeping buyers hopeful. It's worth noting that a candle indicating a trend reversal is more meaningful when it is at a multi-day low, as is the case with the Cable pair.
However, the 5-DMA hurdle around the 1.1460 level limits the immediate upside of the quote ahead of the 21-DMA resistance near 1.1590.
Should GBP/USD bulls retain the reins beyond the 1.1590 level, the monthly high near 1.1740 and the July low of 1.1760 will be in focus.
Meanwhile, a downside break of the 1.1450 support line could quickly take the quote to the 1.1000 psychological magnet. Subsequently, the 1985 low near 1.0520 will be in focus.