Positive signals of price movement on the chart of the GBP/USD currency pair were displayed on Friday before the close of trading last week.
After continuing a series of price declines for 2 consecutive weeks, the rebound in prices following the market reaction to the US NFP jobs report gave an early signal for a change in price trends.
Readings of the report mixed with positive job growth while the unemployment rate declined saw the US dollar fall. The rise in the US stock market and the fall in US bond yields also pushed the subsequent decline of the US dollar.
This gives the idea that a significant depreciation of the US dollar will restrain the Pound Sterling from further depreciating despite still being plagued by risky sentiment for the UK economy.
If you look at the GBP/USD chart, the price has slipped to a low of last week around 1.37300 before a jump of more than 100 pips past the price zone of 1.38000 which was the previous support level.
Analysts would like to see if the rally manages to continue this week past the 1.3800-1.38300 zone which will signal a clearer bullish trend after the price has already passed the Moving Average 50 (MA50) barrier in the 1 hour time frame of price movement.
A higher rise is expected to test the resistance zone at 1.39000-1.39200 before heading back to the SBR (support become resistance) focus zone at 1.40000.
However, if the price returns to the decline continuing the bearish trend of the previous week, the target is for the price to head to the support zone at 1.37000 above the lows reached last week.
