Meanwhile, this trading session started with low , as bears were reluctant to breach the nearest support. This area, however, is expected to surrender, thus allowing the Pound to approach the 200-hour located near the 1.40 mark.
The pair is likely to remain in the 1.4050/1.4100 range by Tuesday morning .
The British Pound continues to depreciate against the US Dollar for the second consecutive session. This bearish momentum has resulted in a breakout of a four-week ascending channel.
At the time of this analysis, the pair was testing the 200-hour SMA located near the 1.4050 mark. Technical indicators demonstrate that there is still some donwside potential, especially if this long-term moving average is breached. A possible downside target in this case could be the 38.20% Fibo and the upper boundary of the breached channel circa 1.40.
On the other hand, fundamentals might still push the rate higher within this session, thus pushing the Pound towards the 55– and 100-hour SMAs at 1.4150.
By and large, longer-term perspective demonstrates that bears should prevail during the following trading sessions.
Upside risks prevailed in the market on Tuesday, thus allowing GBP/USD to end the session with a 74-pip advance. The pair experienced a brief period of consolidation after breaching the 55-hour SMA and the weekly PP, but eventually managed to dash through the 100-hour moving average, as well.
In accordance with technical indicators, there is still some upside potential that could push the rate towards the 1.43 mark where the bottom boundary of the breached four-week channel is located. However, their high positioning suggests that this expected movement up is unlikely to be sustainable for the whole session.
Meanwhile, the southern barrier is guarded by several noteworthy support levels. In case no fundamentals breach this area, the Pound should remain trading near 1.42 by Wednesday morning.