The dismal performance of the Pound Sterling in earlier trading this week has missed the opportunity to strengthen to higher levels against the US dollar which has still traded gloomily in the market over the past few weeks.
In investor vigilance ahead of the US NFP jobs data report this week, recovering market sentiment supported by positive developments in China is seen to continue to put pressure on the US dollar.
Still, the Pound failing to capitalize on the situation to soar higher is likely investors are also wary of the Brexit uncertainty factor that remains overshadowed by the British currency.
Thus, the price movement on the chart of the GBP/USD pair at the beginning of the week was flat as last Friday, with the high level tested around 1.26600 while supported by the Moving Average 50 (MA50) support level on the 1 hour time frame to maintain the bullish signal.
However, in continued trading of the Asian session this morning which saw the US dollar strengthen slightly, the price started to decline below the MA50 level and tested the current support level of the price at 1.26000.
Investors are waiting for further price movements towards the European session before identifying early signals for a change in the price trend.
If it turns out that the price makes a decline and declines beyond the level of 1.26000, the price is likely to go down to the level of 1.25000 to test the RBS zone (resistance become support).
On the other hand, if the price manages to continue the bullish trend movement for a few weeks, the price increase will be seen again with the target for a higher rise is heading to the level around 1.27000.
Reaching that height or higher, will record the latest 5 -week highs on the price chart.
