The GBP/USD pair is set to break from its current 2020 trading week this week, following another heavy rejection from the 1.3100 level.
GBP to USD technical analysis shows that a triangle pattern breakout is coming into focus on both the lower and higher time frames, which could influence the next major directional move in the pair.
GBP/USD medium-term price trend
GBP/USD technical analysis shows that the pair still has a strong bullish bias over the medium-term while trading above the 1.2700 level.
Sterling has been under heavy downside pressure over recent weeks, and has undoubtedly lost upside momentum since the UK election result.
Technical traders will know that the 1.3000 level is very important for the GBP/USD pair, and is likely to remain a key pivot for both bulls and bears.
The GBP/USD pair has been working inside a large triangle pattern on both the lower and higher time frames over recent weeks.
Towards the end of last week we saw a false upside breakout from the neutral pattern, placing the bottom of the triangle pattern back into focus.
Overall, traders should watch for a breakout from the 1.2970 to 1.3100 price range. A downside breakout could result in a drop in the GBP/USD pair towards the 1.2900 level and possibly lower.
GBP/USD short-term price trend
GBP/USD technical analysis shows that the pair is bearish over the short-term while trading below the 1.3090 level.
We recently saw a heavy technical rejection from the GBP/USD pair’s 200-period moving average on the four-hour time frame, around the 1.3090 level.
Traders that are bearish towards the pair in the short-term may have used the rally as a chance to sell GBP/USD, due to the fact that the pair has still been making lower highs.
It is noteworthy that a bullish double-bottom formation is currently in place, following the recovery from the 1.2970 support level last week.
If the 1.2970 support level holds this week, traders are likely to become more bullish towards the pair in the short-term.
Short-term traders would ideally need to see a sustained break above the 1.3100 level this week to confirm the possibility that a major technical bottom is in place.
GBP/USD technical summary
GBP to USD analysis points to an upcoming breakout from a large triangle pattern. Watch for a break of the 1.2970 to 1.3100 level for technical confirmation.