Technical Analysis: GBPUSD bulls need validation from 1.2110

GBPUSD refreshed a three-week high on Tuesday while extending the breakout of 100-SMA. However, a convergence of the 200-SMA and a downward sloping trend line from June 16, around 1.2110 appears a tough nut to crack for the Cable pair buyers. Given the RSI’s nearness to the overbought territory, the upside momentum is less likely to overcome the key hurdle. However, a successful break of the 1.2110 could quickly propel the quote towards the June 30 peak near 1.2190. It’s worth noting that multiple resistances around 1.2230 and 1.2325-30 could challenge the pair buyers beyond 1.2190, before directing them to the previous monthly peak of 1.2405.

Meanwhile, pullback moves may dribble around 1.2050-45 and the 100-SMA level surrounding 1.1960. Following that, an ascending support line from mid-July, close to 1.1940, will be crucial to watch for further downside. In a case where the GBPUSD prices remain weak past 1.1940, the 1.1800 round figure may act as an intermediate halt before directing the bears toward the monthly low, also the yearly bottom, surrounding 1.1760.

Overall, GBPUSD bulls approach the key resistance, a break of which can reverse the downtrend, at least for the short term.