Early in the American session, the British pound (GBP/USD) is trading around 1.2686 above the 21 SMA and below the 8/8 Murray. The instrument has been following a bullish bias as the pair is supported above the 200 EMA. So, GBP/USD is likely to continue its rise over the next few days.
The British pound bounced strongly above the 200 EMA reaching the low of about 1.2594 on Thursday. Since then, we have seen the rally and now the pair is facing a strong resistance area, so we expect a technical correction to occur in the next few hours.
In case the British pound consolidates above the 8/8 Murray and breaks sharply above the downtrend channel, we could expect a bullish move and GBP/USD could reach +1/8 Murray located at 1.2817.
The trend for now remains bullish as long as GBP/USD trades above 1.2596. In this case, our target will be 1.2817 and GBP/USD could reach +2/8 Murray located at 1.2930. Finally, it could reach the psychological level of 1.3000.
On the other hand, in case the British pound falls below 7/8 of Murray located at 1.2573, a bearish movement is expected to continue and the price could reach the psychological level of 1.25 and finally, 6/8 Murray located at 1.2451.
Since June 29, the Eagle indicator is giving a positive signal. Hence, any drop in the pound has been seen as an opportunity to buy in the short term.
