Short GBP USD

•GBP/USD bulls are stepping in at a critical level on the charts.
•A break of 1.3205 is on the cards for the sessions ahead if bears commit below 1.3230s.

Cable is on moving in on critical resistance within a broader downtrend that would be expected to extend lower. The bears will likely be encouraged further on a break below 1.3205 in the coming sessions. The following illustrates the outlook in a top-down analysis starting with the daily chart:

GBP/USD daily chart



From a daily perspective, the price is retesting the old support which would be expected to hold and lead to a downside continuation into the 1.3230s.

GBP/USD H4 chart



The 4-hour time frame illustrates the resistance near the 61.8% Fibonacci retracement level in 1.3225 that guards the 1.3230s. If the price breaks there, then the downside potential becomes less imminent where a phase of consolidation would be expected into the US Consumer Price Index event.

GBP H1 chart



The hourly chart illustrates where the prospects are for slightly higher but should the bears commit, then a break below the hourly support of 1.3205 would probably be on the cards for the sessions ahead.