The GBP/USD currency pair continued its downward trend for a second day, trading around 1.3420 during Asian hours on Monday. A look at the daily chart reveals that the 14-day Relative Strength Index (RSI) has moved down from the overbought zone, now at 53, which is neutral, but it still stays above the middle line, hinting that the momentum might be slowing down. Yet, with the RSI above 50, there’s still a mild bullish feeling in the market.
The 9-day exponential moving average (EMA) remains above the 50-day EMA, supporting the bullish sentiment. Even though the price is below the shorter-term average, it’s sitting above the medium-term one. This indicates a slight pullback in an overarching upward trend. The flattening of the 9-day EMA suggests a pause in short-term momentum, while the ascending 50-day EMA underpins the general rally.
On the flip side, if the GBP/USD pair drops, it could approach the important psychological mark of 1.3400, followed by the 50-day EMA at 1.3363. A slip below this medium-term momentum might create downward pressure on the pair, keeping it near an eight-month low of 1.3010.
