GBP/USD: Negative RSI divergence points to consolidation – Commerzbank

GBP/USD has dropped to around 1.3550 from the peak of 1.3622. The cable is now expected to see some consolidation as Axel Rudolph, Senior FICC Technical Analyst at Commerzbank, spots a negative divergence on the pair’s daily chart.

Key quotes

“GBP/USD has so far risen to 1.3625, close to the March 2009 low and the September 2017 high at 1.3655/58 which are likely to cap today since negative divergence can be spotted on the daily RSI. This points to consolidation being seen. Further up lies the 1.3712 February 2018 low. Longer-term the 2018 peak at 1.4377 is being targeted as well.” 

“Minor support sits between the 1.3483 September high and the 1.3479 December 9 high.” 

“Immediate upside pressure should be maintained while the cable remains above its current December low at 1.3135, though.” 

“Only a drop below the 1.3135 low would negate upside pressure and target 1.2855 November low as well as the 200-day moving average at 1.2770.”