GBP/USD Daily Chart Analysis – 2023-12-07

Two moving averages of short-term (e.g., 20-period) and a longer-term (e.g., 50-period) moving average. The price is currently below both, suggesting a bearish trend. A downward channel is indicating the recent downtrend. The price is testing the upper boundary of this channel, which could act as resistance..Notable levels are the 0.618 (1.25811) and 0.5 (1.25134) Fibonacci levels.The closest resistance level is around 1.26169, and the nearest support is at the lower end of the channel. A significant volume spike appears on a bearish candle, which could indicate strong selling pressure. The RSI is hovering just above the 30 level, suggesting that the currency pair might be in the oversold territory and a potential reversal or pullback could occur. The momentum indicator is showing a downward trend, consistent with the price movement, indicating bearish momentum.

The latest candlestick is suggesting bearish sentiment in the most recent period. The price is consolidating around the 1.25518 level.

 The pair’s continued downward trend coincides with slipping UK and US bond yields and crude oil prices​​.The greenback is regaining strength as the market anticipates soft jobs data from the US. Traders are positioning ahead of the November payroll data, which is expected to show another soft jobs number, influencing the drop of GBP/USD below the $1.26 mark​​.

The confluence of these technical and fundamental factors suggests a bearish outlook in the short term, with key levels to watch for potential trend reversals or continuation. The upcoming US jobs data will be a significant determinant of short-term price action. It’s important to note that forex markets are influenced by a multitude of factors, including geopolitical events, economic data releases, and changes in market sentiment, which can all contribute to the volatility of currency pairs like GBP/USD.

The technical outlook suggests that the GBP/USD is in a downtrend, as indicated by the moving averages and the channel pattern. The near-term resistance and support levels from the Fibonacci retracement and horizontal lines are key areas to watch for potential reversals or continuations of the trend.