After being awaited from last week, the price on the chart of the GBP/USD currency pair is finally seen to successfully make a jump out of the previous horizontal zone.
The price increase situation is driven by the depreciation of the US dollar following the latest economic data from the United States (US) published in the New York session yesterday, which came in with a somewhat declining reading.
Private employment data recorded weak growth and the ISM survey of the US service sector in June showed a significant contraction since April 2020.
The risk to the growing US economy pushed the US dollar to weaken, but the situation slightly recovered for the king of the currency when the minutes of the FOMC meeting were examined.
If observed on the GBP/USD chart, the price has surged past the solid resistance of 1.27000 which has been holding back price gains since last week.
The latest high level was reached around 1.27700 before the movement started to retreat a little and slow until it continued to the opening of the Asian session this morning (Thursday).
The price movement shows a bullish signal that will continue with the price also staying above the Moving Average 50 (MA50) support line on the 1-hour time frame on the GBP/USD chart.
With the momentum displayed, the price increase is expected to continue towards the zone around 1.28000 as the next target.
But if the situation changes with the strengthening of the US dollar, the price will be pushed down again.
The focus will return to the level of 1.27000 which is seen as the RBS zone (resistance become support) the price will be tested.
The price reaction around that will give an indication of the direction of further price movement, whether it declines back to the previous horizontal zone or bounces back to increase again.
