GBP/USD has managed to limit its losses despite the broad-based dollar strength on Tuesday and continued to edge higher early Wednesday. The pair trades within a touching distance of key resistance that seems to have formed at 1.2070 and buyers need to flip that level into support for the recovery to remain intact.
Although the dollar capitalizes on safe-haven flows on Tuesday, hawkish Bank of England (BOE) bets allowed the British pound to stay resilient against its major rivals.
GBP/USD bulls take a breather around 1.2050 inside a fortnight-old rising bearish chart pattern during early Wednesday. That said, recently firmer RSI backs the Cable pair’s corrective pullback from the yearly low.
However, a convergence of the 200-SMA and a downward sloping resistance line from mid-June, around 1.2080, guards the quote’s immediate upside.
Even if the GBP/USD buyers manage to cross the 1.2080 hurdle, the upper line of the stated wedge, near 1.2100, will be crucial for the pair traders.