In the world of forex trading, the GBPUSD currency pair is one of the most popular and widely traded pairs.
As of April 2023, the pair is showing bullish momentum, and traders are keeping a close eye on it to spot any potential changes in the trend.
In this analysis, we will take a deep dive into the technical analysis of the GBPUSD currency pair and try to understand the reasons behind its current bullish momentum.
In our last weekly technical analysis of the GBPUSD currency pair, we explored the possibility of a potential reversal.
Now, a week later, it seems that our prediction may be coming true. Let's take a deeper look at the current state of the pair and analyze its bullish momentum.
|The GBPUSD currency pair looks ready for the pull-back anticipated from the previous week|
|The 50-SMA seems to be acting as support on the 4-hour timeframe|
|Several factors could be responsible for volatility next week despite the Bank Holiday on Monday|
|The general bias on the 1-hour timeframe is showing signs of weakness and momentum to immediately continue the uptrend|
|The price has closed below the 50-SMA on the 1-hour chart with 200-SMA currently providing support|
|The big question is if the 50 simple moving average on the 4-hour chart can provide the necessary support for the price to continue its uptrend|
|In the coming trading week, we will be interested in seeing the price break the established trendline with two major support price levels|
|The GBPUSD currency pair's bullish momentum may be short-lived depending on the outcome of key economic events scheduled for next week|
The GBPUSD Daily Timeframe
Looking at the daily timeframe, we can see that the price is reacting off the labeled supply zone 1 at around 1.25240.
If this rejection is valid, then we can expect the price to trade back to the 1.20975 demand zone 1.
Additionally, there is a possibility of the price touching the 50-SMA which is currently below the price, signaling a bull-controlled market.
The last three trading days saw a clear bear candle closing slightly below the open price of the Tue 4th April candle, which was 1.24100 to be exact.
This price action indicates a potential pullback in the coming days.
GBPUSD 4-Hour Chart Analysis
On the 4-hour timeframe, the GBPUSD currency pair is showing signs of a pullback after reaching the 1.25740 supply zone earlier pointed out on the daily chart.
The 50-SMA seems to be acting as support, but the big question is whether it can provide the necessary support for price action to continue its uptrend.
In the coming trading week, we will be interested in seeing the price break the established trendline with two major support price levels at 1.20150 and 1.22270.
The GU 1-Hour Technical Analysis
The general bias on the 1-hour timeframe is no different as the price action is clearly showing signs of weakness and momentum to immediately continue the uptrend.
The price already closed below the 50-SMA on the 1-hour chart, with the 200-SMA currently providing support.
Whether this support can hold or not, only time and more data next week can answer that question.
Upcoming Events and Volatility
Several factors could be responsible for volatility next week, despite Monday, 10 April being a Bank holiday for the currency pair in focus.
There are some significant events lined up for the week, such as FOMC Member Harker speaking on Tuesday, BOE Gov Bailey speaking on Wednesday, and GDP m/m for the GBP and Core PPI m/m for the USD on Thursday.
All these events have the potential to affect the currency pair's price action significantly.
Conclusion – Is GBPUSD pair reversal ready?
The GBPUSD currency pair is showing bullish momentum in April 2023. However, traders should be aware of the potential pullback indicated by the price action on the daily and 1-hour timeframes.
The 50-SMA seems to be acting as support on the 4-hour timeframe, but traders should watch for the price to break the established trendline with two major support price levels.
Furthermore, upcoming events have the potential to affect price action significantly, and traders should keep an eye on them.
The GBPUSD currency pair is always a topic of interest among traders, and keeping up with its latest trends and news is crucial for successful trading.
By using technical analysis and keeping an eye on upcoming events, traders can make informed decisions and capitalize on the currency pair's bullish momentum.