The price movement pattern on the GBP/USD currency pair chart began to change direction as trading entered the December opening yesterday.
This follows the US dollar's re-strengthening after the lackluster performance displayed last week at the November trading close.
Trump's announcement of tariffs of up to 100% on BRICS countries warmed the atmosphere earlier this week, supporting the attraction of the US dollar as a safe-haven currency.
The pound, which tried to recover last week, is seen to be under pressure again this week with several important economic data sets that will drive the market's direction further.
Observing the GBP/USD chart, the price reached a high of around 1.27500 at the end of last week and fell back below the 1.27000 level on Monday.
Showing a bearish signal with a move below the Moving Average 50 (MA50) resistance line on the 1-hour chart, the price has made a plunge from around 1.27000 to the 1.26200 level.
With that in mind, the tendency for the price is seen to test the focus level at 1.26000 before looking for further clues.
If it breaks lower, the price is expected to extend its decline to the previous support zone at 1.25000.
On the other hand, if the price manages to rebound and surpass the 1.27000 level and the MA50 resistance, there is potential for the price to ‘fly’ higher this week.
The latest 3-week high will be recorded before the price heads towards around 1.28000 as the latest target.
