Chartbook: Chart GBP/USD: Pressuring strong support - room for lower in the coming weeks

Anticipated tests lower have bounced smartly from strong support at 1.3200 congestion/Fibonacci retracement,

with prices posting a fresh year low around 1.3160 before bouncing back to congestion resistance at 1.3500.

Choppy trade has given way to a fresh pullback, with prices once again pressuring support at 1.3200.

Both weekly stochastics and the weekly Tension Indicator are bearish, highlighting room for a break beneath here, and continuation of January losses towards critical support at the 1.2985 retracement and congestion around 1.3000.

By-then oversold weekly stochastics could limit any initial tests of here in consolidation, before negative monthly studies prompt a deeper retracement and correction of multi-month gains.

Meanwhile, resistance is at congestion around 1.3500 and extends to the 1.3785 - 1.3865 highs.

Monthly studies are falling, suggesting any immediate tests of this range should be limited in fresh consolidation. A break above here, however, will improve sentiment and extend September 2022 gains towards further congestion around 1.4000 and critical resistance within the 1.4250 year high of June 2021 and 1.4375 multi-year high of April 2018.

From a longer-term perspective, multi-month studies are mixed.

Overbought stochastics are unwinding, suggesting potential for a close below 1.3000 and completion of a distribution top beneath 1.4000.

Focus will then turn to the 1.2500 Fibonacci retracement, where the rising Tension Indicator could prompt renewed buying interest/consolidation.