#GBPUSD @ 1.22834 grinds near five-week high inside bearish chart formation., @nehcap view: Further downside expected (Pivot Orderbook analysis)

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• GBP/USD grinds near five-week high inside bearish chart formation.
• Divergence between higher-high on prices and lower high on RSI (14) tease sellers.
• Upside break of 1.2345 could defy the bearish signals and challenge previous monthly top.
• UK Inflation may disappoint pair buyers amid mixed forecasts.

The pair currently trades last at 1.22834.

The previous day high was 1.23 while the previous day low was 1.2169. The daily 38.2% Fib levels comes at 1.225, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2219, expected to provide support.

GBP/USD picks up bids to defend the previous day’s run-up around the 1.2300 round figure, despite posting only 0.08% intraday gains, as the Cable pair traders await the UK’s key inflation data on early Wednesday. Even so, the quote stays inside an eight-day-old rising wedge bearish chart formation.

Not only the rising wedge but bearish RSI (14) divergence also keeps the GBP/USD sellers hopeful. That said, the oscillator’s inability to back the higher-high on prices portrays the bearish RSI divergence.

However, the quote’s current upside could lure GBP/USD buyers if the scheduled UK data offers a positive surprise and allow the pair to cross the stated wedge’s upper line, close to 1.2325 by the press time.

Following that, the mid-December 2022 low around 1.2345 may probe GBP/USD bulls before directing them toward the previous monthly peak surrounding 1.2445.

Alternatively, pullback moves need validation from the 200-SMA level of 1.2153 while the aforementioned wedge’s lower line, near 1.2200 at the latest, restricts the quote’s immediate downside.

It’s worth noting, however, that the GBP/USD weakness past 1.2153 won’t hesitate to refresh the monthly low, currently around 1.1840.

Trend: Further downside expected

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2285 at the time of writing. Pair opened at 1.2279 and is trading with a change of 0.05% % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.2095, 50 SMA 1.2066, 100 SMA @ 1.1699 and 200 SMA @ 1.1989.

The previous day high was 1.23 while the previous day low was 1.2169. The daily 38.2% Fib levels comes at 1.225, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2219, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.2199, 1.2119, 1.2069
• Pivot resistance is noted at 1.233, 1.238, 1.246

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