GBP/USD Technical Analysis: Bullish Momentum Continues

GBP/USD Market Overview

The GBP/USD currency pair continues its upward trajectory, maintaining a two-week ascending trend. This price action reflects a correction toward fair value following a period where the US dollar appreciated without significant fundamental justification. Despite the release of Federal Reserve meeting minutes, which reinforced expectations for a potential rate hike, the market remains largely indifferent to this development, suggesting the news is already priced into the currency pair.

Technical Analysis

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From a technical perspective, the pair exhibits a firm upward trend, supported by the recent breach of the 1.3369-1.3377 resistance area. This breakout suggests that bullish momentum is likely to persist within the existing sideways channel on the daily timeframe. With a light calendar of macroeconomic events this week, price action is expected to be primarily driven by technical indicators and chart patterns.

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COT Report and Long-term Sentiment

Commitments of Traders (COT) data indicates that commercial trader sentiment remains fluid, with net positions for non-commercial traders recently decreasing by 3,600 contracts. While the dollar may face long-term headwinds due to prevailing economic policies and international trade dynamics, the pound maintains its resilience. The long-term trend line on the weekly timeframe continues to provide a foundation for potential further gains.

Intraday Strategy

For the session of July 9, key levels to monitor include support at 1.3301-1.3309 and resistance targets near 1.3465-1.3480. Given the current trend, traders may look to maintain long positions following the recent breakout above 1.3369-1.3377. Conversely, should the price consolidate below the 1.3364-1.3377 zone, short positions targeting the 1.3301-1.3309 range may become viable.

Trading Considerations

Market participants should note that volatility remains moderate, though it continues to outpace that of the euro. With no significant economic releases scheduled in the UK and only secondary data expected from the US, traders should remain focused on technical levels and Ichimoku indicator signals, such as the Senkou Span B at 1.3260 and the Kijun-sen at 1.3364. As always, implementing proper risk management, including stop-loss orders moved to breakeven, is recommended.

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