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Fan Yang

GBP/USD Shifting into a Bullish Trend

$GBPUSD has been bearish in 2018 but appears to have shifted from the bearish trend into a more sideways one since late 2018. 

GBP/USD Daily Chart

(click to enlarge)

Extending the Bullish Breakout :
- We saw a bullish breakout from a falling trendline and the 200-day simple moving average in January.
- The rally also pulled the RSI back to 70, which shows failure to maintain bearish momentum.
- After the small breakout, there was a pullback. The pullback found support around 1.28.
- Meanwhile, the RSI held above 40. These are signs that the trend has shifted.
- Since then, we have seen a higher high and higher low.
At the crossroad.
- There is resistance around 1.34. I think there could be a stronger pullback from here.
- However, if price can hold above 1.30, we might even have a bullish trend developing. The mode would be neutral-bullish.
- 1.28 might offer a final line of defense for the bullish scenario. But a break below that suggest the overall mode is neutral-bearish.
- In the bullish scenario, we can anticipate upside to 1.40, and up to the 1.4375 high from 2018.
- A break below 1.28 on the other hand suggests pressure remains on the 1.24-1.25 lows from 2018 and early 2019. 

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