GBP Sterling retest support 18/5/2022

The British pound achieved noticeable gains against the US dollar within the bullish context, surpassing the official target of the previous report located at 1.2410, and attacking the resistance level of the psychological barrier 1.2500.

Technically, by looking at the a 240-minute chart, we find the simple moving averages providing a positive motive that supports the possibility of continuing the rise, and this contradicts the clear negative signs on stochastic that gradually loses the bullish momentum and is supported by the negative signs coming from the 14-day momentum indicator on the short time intervals.

We believe there is a chance for a bearish bias in the coming hours to retest 1.2410 and 1.2360 before determining the next price destination.

Only from above a breach of 1.2500 is a basic and important condition for resuming the bullish bias that started yesterday. That may pave the way for a visit to 1.2545 initially, which may extend later towards 1.2590.

Note: inflation data is due today in UK, and we may witness high volatility.

Note: Trading on CFDs involves risks. Therefore, all scenarios may be possible. This article is not a recommendation to buy or sell but rather an explanatory reading of the price movement on the chart.

S1: 1.2360	R1: 1.2545
S2: 1.2250	R2: 1.2615
S3: 1.2175	R3: 1.2725