GBP/USD continued to strengthen for the third consecutive session on Monday. This upward movement allowed the pair to reach the upper boundary of a medium-term channel at 1.36. After testing this psychological level, the pair was pressured back down to the 55-, 100– and 200-hour SMAs at 1.35550.
This strong support cluster was breached during this Asian session—a move which might actually point to further decline in this session. Daily technical indicators likewise support this scenario.
From technical point of view, this bearish sentiment should result in a test of the bottom channel line circa 1.34. However, it is unlikely that the pair falls this low, as technical indicators on the 4H and 1D time-frames favour a soon recovery. The pair is expected to remain in the 1.3450/1.3650 territory today.
