Versus the USD, sterling outperformed last week, gaining for a third consecutive week and refreshing year-to-date tops at $1.2653. Adding +0.5%, this has hauled weekly price action to within a stone’s throw of major trendline resistance taken from the high of $1.4250. Therefore, it is likely that we will be seeing the currency pair test the aforementioned structure sometime this week. Also important is the neighbouring weekly resistance nestled around $1.2767. You will also acknowledge that on the daily chart, we have a resistance zone comprising the noted weekly resistance level and a daily resistance coming in at $1.2638.
Consequently, buyers have a notable technical headwind this week, which could help bolster H1 resistance at $1.2657, left unchallenged on Friday after price topped just ahead of the level. Demand is at $1.2598-$1.2614 in the event of a further correction in short-term price action, yet a break of current resistance unmasks the $1.27 psychological level.
Ultimately, between the $1.27 handle and H1 resistance at $1.2657, which happens to align with the weekly trendline resistance, is an area sellers may be drawn to this week. However, conservative sellers will unlikely commit until H1 trendline support is cleared, drawn from the low $1.2436. Should price test H1 demand at $1.2598-$1.2614 before reaching $1.27-$1.2657, a short-term bullish scenario could emerge, targeting the aforementioned resistance area.
Consequently, buyers have a notable technical headwind this week, which could help bolster H1 resistance at $1.2657, left unchallenged on Friday after price topped just ahead of the level. Demand is at $1.2598-$1.2614 in the event of a further correction in short-term price action, yet a break of current resistance unmasks the $1.27 psychological level.
Ultimately, between the $1.27 handle and H1 resistance at $1.2657, which happens to align with the weekly trendline resistance, is an area sellers may be drawn to this week. However, conservative sellers will unlikely commit until H1 trendline support is cleared, drawn from the low $1.2436. Should price test H1 demand at $1.2598-$1.2614 before reaching $1.27-$1.2657, a short-term bullish scenario could emerge, targeting the aforementioned resistance area.