The GBP/USD currency pair chart maintained its gains at the opening of early trading this week with the price increasing to a new high exceeding last week's level before retreating back down again.
Investors took precautions due to market uncertainty for the last week of February trading while watching for new clues.
The US dollar started off gloomy in the Asian session yesterday Monday morning before recovering to show strengthening in the following sessions.
Investors are preparing for a risky market situation again following President Donald Trump's statement that tariffs on Canada and Mexico will continue as announced earlier in the day.
For the movement of the US dollar, the US consumer confidence survey will be observed in the New York session tonight before the focus shifts to the PCE price index data at the end of the week.
On the GBP/USD chart, the price almost touched the 1.27000 level before retreating back towards the 1.26000 zone.
The price action in the New York session yesterday was seen to be flat until the trading session that continued into the Asian session this morning.
However, the price hovering below the Moving Average 50 (MA50) resistance line on the 1-hour time frame on the GBP/USD chart is an early warning of a trend change.
If the price starts to decline below 1.26000, further declines are likely to occur and strengthen the bearish signal for the price.
Next, the price will test the level around 1.25000 before focusing lower towards 1.24000.
However, if the price manages to bounce back up, the 1.27000 zone is an important resistance for the price to test and break through.
If successful, the price will record a new 11-week high towards the target at around 1.28000.
