GBPUSD appears to have posted a double top at the 1.2640 resistance and any violation beneath the 38.2% Fibonacci retracement level of the down leg from 1.3515 to 1.1409 at 1.2212, could confirm the pattern, shifting the bias back to bearish.
In terms of momentum indicators, the MACD oscillator is endorsing the neutral outlook in the daily timeframe, while the RSI is approaching the horizontal 50 neutral level. Noteworthy, the price is trading within the 20- and 40-day simple moving averages (SMAs) and below the red Tenkan-sen and blue Kijun-sen lines.
If the price rebounds on the 40-day SMA and the Ichimoku cloud, the market probably could be sent towards the 50.0% Fibonacci mark of 1.2460 before meeting the 1.2640 key level and the 100-day SMA at 1.2667. Marginally above this area, the 61.8% Fibonacci of 1.2710 and the 1.2725 resistance could move into the spotlight before a strong rally until the 1.3210 high from March 9.
On the other hand, if there is a successful drop beneath the 38.2% Fibo and the Ichimoku cloud, support could come from the 23.6% Fibo of 1.1907. Pushing well below this region would open the door for the 35-year low of 1.1409, registered on March 20.
Concluding, GBPUSD has been in a neutral bias over the last six weeks and any advances above 1.2640 could shift the short-term outlook to bullish. However, a decline below 1.2212 could confirm the double top formation, sending the market lower again.
