GBP/USD catches a small bid at 1.24 but the bears will need to break the level if the downtrend is to continue

• GBP/USD trades just under flat after spending much of the session higher.
• Cable is in a clear downtrend and the 55 Exponential Moving Average was a decent resistance.

GBP/USD 1-hour chart

GBP/USD is in a pretty clear downtrend on the hourly chart below. There has been a succession of lower highs and lower lows in recent sessions. As the risk-sentiment turned higher GBP/USD moved up with the major indices. 

Looking closer at the chart below, cable spent much of the day higher. Just recently the price bounced off the blue 55 Exponential Moving Average and moved toward the wave low. If the black support line just under 1.24 does break then there is a good chance that the trend could continue. The next support will then be the red line just under 1.2350.

Looking at the indicators, the MACD histogram turned green but the signal lines are still under the zero level. The histogram is now looking like it might also turn red and this could be the signal for the short trade. The Relative Strength Index has produced a little bullish divergence showing that the downside momentum was wearing thin. If this trend is to continue then the break of 1.2389 is key.

Additional levels