Market news
17.03.2023, 02:34

GBP/USD Price Analysis: Pair rebounds from 21-DMA amid muted US Dollar demand

  • GBP/USD faces key resistance at 50-DMA and descending trendline.
  • Major central bank's intervention supports GBP/USD rebound.
  • Eyes on UK CPI data and BoE rate decision next week. 

GBP/USD rebounds from the 21-Daily Moving Average (DMA) at the 1.2000 key psychological level. The bounce comes after easing demand for the US Dollar due to backstop plans put forward by major central banks.

Federal Reserve (Fed), Swiss National Bank (SNB), and Bank of England (BoE) intervened with rescue plans, calming risk sentiment fired by liquidity crunch among some regional and international banks. 

GBP/USD needs to surpass the 50-DMA, currently around 1.2125, to maintain the bullish bias. The Relative Strength Indicator (RSI) remains in favor of the upside.

A convincing break above the 50-DMA could lead the pair toward the next resistance and descending trendline from January's high at 1.2435. Breaking above the downward slope could take GBP/USD to the March high of 1.2215.

As for the downside, it's likely to be to limit the 21-DMAaround Thursday's low at 1.2025. A convincing break below the 21-DMA could lead the pair to multi-tested support at 1.1924.

The last line of support is seen at 1.1830. All important levels are being watched ahead of next week's UK Consumer Price Index (CPI) and BoE announcements.

GBP/USD: Daily chart

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