GBP/USD traded higher on Tuesday after it hit support near the 1.3505 barrier and the upside support line drawn from the low of Jan. 28. As long as the rate stays above that line, we will maintain a positive stance.
If the bulls are willing to stay in the driver’s seat, we could soon see them overcoming the 1.3615 barrier, thereby confirming a forthcoming higher high on both the 4-hour and daily charts. Such a move could initially pave the way towards the peak of Jan. 20, at 1.3660, or the 1.3690 zone, marked by the high of Jan. 17. If the bulls are unwilling to stop there, we could see them climbing towards the high of Jan. 13, at 1.3750.
Shifting attention to our short-term oscillators, we see that the RSI lies above 50 and points up, while the MACD runs slightly above both its zero and trigger lines, pointing up as well. Both indicators detect upside speed and support the notion for further advances.
To abandon the bearish case, we would like to see an apparent dip below 1.3490. This will confirm a forthcoming lower low and the break below the upside line taken from the low of Jan. 28. The bears could then aim for the 1.3435 barrier, marked by the low of Feb. 1, where another break could extend the fall towards the 1.3395 zone, marked by the low of Jan. 31.
Slightly lower, there is the 1.3365 hurdle, defined as a support by the lows of Jan. 27 and 28, which could also get tested.
