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The GBP/USD currency pair exhibited a robust rebound last week, signaling a potential short-term price bottom around the 1.3135 level. This technical recovery is supported by a bullish divergence on the 4-hour MACD indicator, indicating waning bearish momentum. Market focus is now shifting upward, with the initial bias for the coming week remaining slanted toward the upside as buyers attempt to push prices higher.
Technically, a sustained break above the 38.2% Fibonacci retracement level at 1.3341 (calculated from the 1.3675 to 1.3135 decline) will strengthen the bullish reversal case. Should this level be cleared, the next upside target is key resistance at the 61.8% Fibonacci retracement level of 1.3469. Conversely, if the pair falls back below the minor support at 1.3230, it would invalidate the immediate bullish outlook and suggest a continuation of the broader corrective phase.
Traders should closely monitor key economic releases and central bank commentary from both the UK and US this week to gauge fundamental drivers. A failure to clear upper resistance levels could leave the pair vulnerable to range-bound trading or renewed downward pressure, making tight risk management essential around technical pivot points.
