Pound Weakens at 1.38—Is a "Rising Wedge" Signaling a Surprise?
GBP/USD fell slightly after four consecutive days of gains, hovering around 1.3800 during Friday's Asian session. The daily chart shows the price beginning to "hide" within a narrowing range. This pattern is often called a rising wedge and usually signals that buyers are running out of steam, increasing the risk of a bearish reversal.
However, the uptrend hasn't completely broken. GBP/USD is still holding above the 9-day and 50-day EMAs, indicating a bullish bias. As long as the price respects the rising short-term EMAs, the decline can usually be contained. However, the market is starting to be cautious as the 14-day Relative Strength Index (RSI) indicator is at 73.95 (overbought territory). The RSI has indeed fallen from 78.53, but it remains high—this signals positive momentum, but is vulnerable to consolidation or correction.
For key levels, the nearest resistance is at 1.3869 (the highest since September 2021), followed by the 1.3900 area near the upper boundary of the wedge. If it breaks and holds, further upside potential could open up toward 1.4248. Conversely, initial support is at the 9-day EMA around 1.3626, followed by the 1.3570 area (the lower boundary of the wedge). If the price breaks through the wedge, the bias could shift to bearish, opening the way to the 50-day EMA at 1.3445. (az)
Source: Newsmaker.id
