The GBP / USD pair is trading above 21 SMA and below strong resistance of 2/8 murray, showing strong bullish signal after breaking +1/8 murray level at 1.3610. The pair is now approaching overbought levels.
Yesterday in our article on trading signals, we explained this technical rebound of the GBP / USD pair. We observed a clear signal when the consolidation began above 1.3610. We invite you to read this article and take out some points that will be useful when such movements happen in the market.
The bullish bias could continue until finding resistance at the 2/8 murray zone around 1.3793. This level on previous occasions has acted as a strong support. Now we believe it could keep the pair under downward pressure.
On the other hand, the demand for the safe-haven US dollar has been decreasing. Its index USDX has left a double top in the 93.15 area. We believe that below this level, there will be a technical correction in the short term, that could favor the British pound.
As long as the GBP / USD pair in 4-hours charts is below the 200 EMA (1.3916), it could continue with the downward movement. Every time, it approaches this level, it will be a good selling opportunity around this area.
COVID-19 cases in the UK remain high, at over 40,000 a day. This could drag the country's economy down and the GBP / USD pair could lose its strength.
Our recommendation is to sell at the 2/8 murray zone around 1.3793. Alternatively, if the pair makes a technical bounce at the 1.3671 support zone, we can buy with targets at 1.3973. The Eagle Indicator is showing a bullish signal.Support and Resistance Levels for July 22 - 23, 2021
Resistance (3) 1.3890
Resistance (2) 1.3860
Resistance (1) 1.3806
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Support (1) 1.3759
Support (2) 1.3710
Support (3) 1.3674
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Trading tip for GBP/USD for July 22 - 23, 2021
Sell below 1.3793 (2/8), with take profit at 1.3708 and 1.3671 (0/8), stop loss above 1.3825.
Buy if rebound at 1.3671 (0/8), with take profit at 1.3793 (2/8), stop loss below 1.3632.
