GBP/USD Price Analysis: Turns south after facing rejection at 21-DMA

• GBP/USD sellers return amid cautious mood, Omicron woes in the UK lurk.
• 21-DMA caps the rebound, as the pair keeps range within a falling channel.
• A retest of the 1.3200 level remains on the cards amid bearish RSI.

GBP/USD is back in the red on Wednesday, reversing a part of the previous day’s rebound amid a worsening market mood.

The risk-off sentiment is benefiting the US dollar bulls, weighing negative on the cable. Meanwhile, persistent Brexit concerns combined with the risks of the Omicron covid variant-induced restrictions on the UK economy continue to overwhelm GBP traders.

Investors now look forward to the UK and the US GDP revisions for fresh trading while the Omicron updates will be closely followed.

Looking at GBP/USD’s daily chart, the pair has been traversing within a falling channel after peaking out near 1.3515 on November 18.

Meanwhile, the latest rebound from multi-day lows of 1.3173 appears to have faltered at the 21-Daily Moving Average (DMA) at 1.3267.

Subsequently, sellers are making a comeback, eyeing a retest of Tuesday’s low of 1.3198. If the downside momentum gathers traction, then the above-mentioned three-day low could be probed.

The 14-day Relative Strength Index (RSI) is inching lower below the midline, suggesting that the bears are likely to retain control going forward.

GBP/USD: Daily chart

Alternatively, acceptance above the 21-DMA hurdle is needed to revive the recovery attempts, as the buyers will then aim to challenge the falling trendline resistance at 1.3345.

Ahead of that level, GBP bulls will test the bearish commitments at the 1.3300 psychological magnet.

GBP/USD: Additional technical levels