GBP/USD Elevates Toward Multi-Year High; Bullish Tone Grows

GBP/USD has acquired buoyancy after recently returning above the Ichimoku cloud and is now clearly eyeing the 34-month peak of 1.4236. The bullish simple moving averages (SMAs) are safeguarding the broader uptrend, while the Ichimoku lines are indicating that positive momentum is picking up.

The short-term oscillators appear skewed to the upside and are signalling that bullish sentiment is intensifying. The MACD is strengthening above its red trigger line in the positive region, while the RSI is manoeuvring towards the 70 level. The stochastic oscillator has reclaimed a positive charge and is endorsing additional price gains in the pair.

Steering higher, the pair could meet early upside limitations from the multi-year high of 1.4236. Moreover, overshooting this top, buyers may then encounter congested obstacles attempting to impede further price gains. These involve the 1.4307 barrier, which happens to be the 161.8% Fibonacci extension of the down leg from 1.3200 until 1.1410, and the 1.4345-1.4376 resistance border. Should buying interest decisively conquer the latter, which is associated with the zone between the peaks of January and April 2018, the price may propel for the 176.4% Fibo extension of 1.4567 and the adjacent inside swing low of 1.4615, identified in June 2016.

Otherwise, if the price pulls lower, a support zone could develop from the 1.4016 barrier until the blue Kijun-sen line at 1.3933. Should the pullback retreat into the cloud, an adjacent section from the 50-day SMA at 1.3892 until the 1.3800 trough, could then attempt to negate the decline from snowballing.

Summarizing, GBP/USD has repowered its bullish bearing above the SMAs and the 1.4000 mark. That said a deeper retracement below the 1.3669 border could start to undermine the positive structure.