Gbpusd Trades Near Solid Support

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Gbpusd Trades Near Solid Support

Gbp/Usd Trades Near 1.2800, Next Resistance At 1.2850

GBP/USD is trading in a narrow range near the 1.2800 handle after refreshing weekly highs on Monday. On the UK's side, the economic calendar is light, which means the traders will be focusing entirely on the US inflation data on Thursday.

But before that, Powell's testimony will also be closely watched, which could provide some valuable insights into the monetary policy.

Rsi Hovers Around 60 Level

On the GBP/USD H4 chart, the RSI is hovering around 60 and was near 80 on Monday. This is a sign that the GBP/USD pair is still under the influence of the bulls despite the recent technical correction.

On the way up, the next resistance is around 1.2850, followed by the 1.2860. After that, there is the 1.2900, which is a major static level.

On the way down, the GBP/USD support is around 1.2800, followed by the 1.2750 level. If both of these levels fail to hold, the 20 SMA around the 1.2710 will serve as dynamic support.

During Monday's session, the GBP/USD pair lost its momentum near 1.2850 and has since dropped to near the 1.2800 support. For the most part of Tuesday, the GBP/USD has remained in the consolidation phase and the same will continue in the US session.

The overall market's risk appetite has improved which has made it difficult for the greenback to show its muscles against the GBP. As of now, the US stock futures are green which indirectly means the USD is losing ground.

Later today, the Fed Powell will be answering questions in the Senate and will also present a report on monetary policy. It is safe to say that any cues about the rate cutes will inject a lot of volatility in the GBP/USD.

The general perception is that Powell will adopt a dovish approach. In that case, we can expect the GBP/USD to stay green and target the next resistance levels.

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