GBP/USD Price Analysis: Less confident pullback fades reversal odds, 1.1700 a critical support

• Overbought indicators on smaller timeframes may trigger a fresh sell sooner.
• A less-confident pullback has faded the odds of a bullish reversal.
• Downward sloping 200-EMA adds to the downside filters.

The GBP/USD pair is displaying back-and-forth moves in a narrow range of 1.1821-1.1842 in the early Tokyo session. The asset has remained sideways the entire week after printing a fresh two-year low of 1.1716 on Tuesday.

A less-confident pullback move after refreshing the two-year low at 1.1717 has faded the odds of a bullish reversal in the cable. The asset has shown a weak retracement to near 1.1875, which is expected to turn again into a downside move as momentum oscillators will get overbought on lower timeframes.

The 50-period Exponential Moving Average (EMA) at 1.1837 is acting as major resistance for the pound bulls. Also, the 200-EMA at 1.1965 is sloping downwards, which adds to the downside filters.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in a 40.00-60.00 range, which signals a consolidation ahead. A downside move below 40.00 by the momentum oscillator will trigger a fresh sell.

The investing community will witness a vertical downside move if cable drops below the two-year low at 1.1717, which will drag the asset towards the 25 March 2020 low at 1.1638, followed by the 19 March 2020 low at 1.1472.

Alternatively, the pound bulls could regain their mojo and may drive the asset higher towards the August 3 low and high at 1.2135 and 1.2200 after violating the psychological resistance of 1.2000 decisively.

GBP/USD two-hour chart