The GBPUSD pair has recently displayed a notable surge in momentum, achieving a significant breakthrough by eclipsing the 1.2500 psychological threshold. This upward trend is further highlighted by the pair's ascent to its highest level in the past two months, indicating a strong bullish sentiment in the market. The technical landscape mirrors this optimism, with the 200-day Simple Moving Average (SMA) being decisively surpassed, marking a potential shift in the medium-term market outlook.
Key technical indicators bolster the bullish narrative. The Relative Strength Index (RSI), a vital tool in assessing market momentum, has climbed above the neutral 50 mark and is edging closer to the overbought territory. This upward trajectory of the RSI, which began its rise around September 27, signals sustained buying interest. Complementing this, the Moving Average Convergence Divergence (MACD) maintains its positive orientation above its trigger line, reinforcing the dominance of buyers in the current market phase.
The bullish scenario sees the GBPUSD setting its sights on further resistances. An immediate target is the 1.2545 level, closely followed by the 50.0% Fibonacci retracement mark of the descent from 1.3140 to 1.2035, located at 1.2590. A continuation of this upward momentum could challenge the 61.8% Fibonacci level at 1.2720, presenting a more formidable resistance for the pair.
However, the market remains susceptible to bearish pressures. A reversal below the 38.2% Fibonacci level of 1.2460, coupled with a breach below the 200-day SMA, could trigger a significant downturn. Such a move could direct the pair towards the 23.6% Fibonacci level at 1.2300. Further bearish momentum could target the intersection of the 20- and 50-day SMAs at 1.2250, a critical juncture representing the bullish crossover point.
In summary, while the GBPUSD has demonstrated an exhilarating rally to a two-month high, surpassing critical technical barriers, investors and traders should remain vigilant. The path to a confirmed bullish trend reversal in the medium term is laden with potential obstacles and resistance levels. The current market dynamics underscore the importance of monitoring these key technical indicators and levels to gauge the future trajectory of GBPUSD.
