29.11.2023 05:09 PM
GBP/USD: head & shoulders

The GBP/USD pair is trading in the green at 1.2700 at the time of writing. It remains to see how it reacts around this psychological level. The bias remains bullish, so further growth could be natural as the Dollar Index remains under deep selling pressure.

Fundamentally, the UK Net Lending to Individuals matched expectations, while Mortgage Approvals and M4 Money Supply reported positive data. On the other hand, the USD could try to take the lead as the US Prelim GDP reported a 5.2% growth versus the 5.0% growth expected, while the Prelim GDP Price Index rose by 3.6% beating the 3.5% growth estimated.

GBP/USD 1.2672 As Neckline!

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From the technical point of view, the bias is bullish as long as it stays above the uptrend line. It has increased within an up channel but its failure to reach and retest the upside line announced exhausted buyers.

Now, it has developed a potential Head & Shoulders pattern. Still, a downside reversal is far from being confirmed.

GBP/USD Outlook!

As long as it stays above the uptrend line, the GBP/USD pair could resume its growth. New false breakdowns could bring us new longs.

On the other hand, dropping and closing below 1.2672 and under the uptrend line is seen as a selling opportunity. This scenario activates the bearish pattern.

Ralph Shedler,
Analytical expert of InstaForex
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