Early in the European session, the British pound is trading around 1.1858, below the 21 SMA (1.1881) and inside the symmetrical triangle. GBP/USD is likely to trade in a range between 1.1925 and 1.1790 in the next few hours.
GBP/USD continues to trade above the uptrend channel from early November. According to the 4-hour chart, we can see that the pound is showing signs of exhaustion. Therefore, it is likely that there will be a decline in the next few hours towards the bottom of the symmetrical triangle.
GBP/USD has resistance at 1.1930 and 1.1962 (+1/8 Murray). In case it breaks and trades above these resistances, the price could reach the psychological level of 1.20 and could even reach +2/8 Murray located at 1.2207.
On the downside, 1.1750 is expected to represent a key level which coincides with the bottom of the downtrend channel. In case of a sharp break, we should expect consolidation below and the price could drop below the 8/8 Murray located at 1.1718 and it could reach the 200 EMA located at 1.1513.
The symmetrical triangle pattern could offer a short-term decision to take a buying or selling opportunity. The key point would be to wait for the pound to consolidate above 1.1930 to buy or wait for it to break below 1.1750 to sell.
On the other hand, the pound is likely to find a strong technical bounce around 1.1750 or around 1.1718 (8/8). In case it continues to trade above this level, we will have an opportunity to buy. The pair could once again recover the bullish trend and it could reach the psychological level of 1.20.
Our trading plan for the next few hours is to operate the symmetrical triangle and sell below 1.1881 (21 SMA), with targets at 1.1770 and 1.1750. The eagle indicator is showing a negative signal which supports our bearish strategy.
