"GBP/USD Reversal Setup at Resistance: Bearish Target to 1.3378"

Technical analysis off GBP/USD (British Pound / U.S. Dollar) on the 1-hour timeframe, forecasting a potential downward correction from a key resistance level.


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🧭 Analysis Overview:

Current Bias: Bearish reversal expected

Trend Context: Price has reached a significant resistance level after a strong rally

Indicators:

EMA 50 (1.35011) and EMA 200 (1.34946) show bullish alignment, but price is overextended.

RSI (14): At 79.85, deep into overbought territory—suggesting potential for a downside pullback.




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📌 Key Technical Elements:

1. Resistance Level:

Price has sharply rallied into the 1.36159–1.36200 area and is now showing signs of rejection (marked by red arrow).

This level acted as a prior supply zone and aligns with overbought RSI conditions.



2. Projected Bearish Move:

The idea suggests a two-phase decline:

First drop to EMA cluster/support level near 1.35011–1.34946

Then extended move to 1.33787 (final target point)


This would represent a total drop of about 1.8% from the top.



3. Support Levels:

Multiple support zones identified:

Intermediate support: Around EMA 50/200 zone

Major support target: Horizontal level at 1.33787




4. Bearish RSI Signal:

RSI nearing extreme overbought (>70) and beginning to curve down, supporting potential short setup.





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🎯 Trading Idea:

Setup: Bearish reversal from resistance zone

Entry: Near 1.3615–1.3620 (confirmation needed)

First Target: 1.3500 zone

Final Target: 1.33787

Stop-Loss: Above recent highs (around 1.3630+)



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🛑 Risk Considerations:

Multiple economic event icons shown — news-driven volatility (GBP/USD is sensitive to both UK and U.S. data).

A strong breakout above the resistance zone would invalidate the bearish setup and could trigger further bullish continuation.



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✅ Summary:

This is a short setup for GBP/USD based on an overbought RSI, resistance rejection, and clear target levels. The forecast suggests a potential 1.8% downside, making this a well-defined reversal opportunity, provided confirmation aligns.



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