Wednesday, May 17, 2023
Black lines- bullish channel (broken)
Green line- bearish RSI divergence
GBPUSD is trading around 1.2487. Short-term trend is bearish as price is making lower lows and lower highs. Price broke out and below the bullish channel and provided a new reversal signal. Combined with the fact that the RSI was making lower highs, the chances of a reversal have increased. Price bounced back up towards the lower channel boundary to test it from below. Price got rejected. This was another bearish sign. Price then made new lows towards 1.2420. Price is bouncing again but it seems that another lower high is being formed. GBPUSD might be oversold in the near term, but overall it remains vulnerable to more downside.
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