GBP/USD Technical Outlook: Pullback Falls Near Key Support Levels

GBP/USD continues its downward correction near 1.3420 during early Asian trading on Monday, extending weakness into a second consecutive session. The technical landscape reveals moderating momentum as the 14-day RSI declined from overbought conditions to 53, though it remains positioned above the midpoint, preserving a subtle bullish tilt to the pair’s structure.

Bullish Indicators Remain Intact Despite Pullback

The nine-day EMA continues to trade above the 50-day EMA, maintaining the foundation of the intermediate uptrend even as price retreats from recent highs. This configuration—with the short-term average flattening while the medium-term line continues its ascent—reflects a minor consolidation within the prevailing rally rather than a trend reversal. The setup suggests the broader advance remains intact, though near-term momentum requires reassessment.

Resistance Zone and Recovery Targets

For GBP/USD to regain bullish control, a daily close back above the nine-day EMA at 1.3455 would be essential. Should the pair surpass this threshold, bulls would likely target the three-month peak of 1.3534, originally set on December 24. Further upside could then shift focus toward the six-month high of 1.3726, with aggressive gains potentially reaching 1.3788—the strongest level since October 2021.

Downside Risks and Support Levels

The path lower remains open if weakness persists. GBP/USD falls toward the psychologically significant 1.3400 level in the near term, followed by the 50-day EMA support at 1.3363. Breaking below this medium-term pillar would open the door for accelerated declines toward the eight-month low of 1.3010, exposing further downside pressure on the pair.

The technical picture remains balanced, with the pair consolidating gains while testing immediate support in this session.