A daily gain of around 70 pips was recorded on the GBP/USD currency pair chart yesterday following a 100 pip gain earlier in the week.
As expected, the US dollar continued to extend its depreciation and gave the Pound room to recover its performance this week.
However, investors should be careful with the movements of both currencies ahead of the US and UK manufacturing and services PMI data to be published on Thursday.
The direction of price movement on the GBP/USD chart changed last week after the decline failed to extend when the 1.34000 support zone was tested.
The rebound at the end of last week has investors ready to expect a change in price trend to occur this week.
Starting trading slowly above the 1.34000 level, the price has made an increase until it broke through the 1.35000 resistance on Tuesday.
Trading reached a high of 1.35300 in the New York session yesterday and price action is seen to remain sluggish around that in the Asian session and continuing into the European session opening today (Wednesday).
The expectation for a higher price move is to head towards the next focus zone at 1.36000.
The zone has attracted a strong price reaction in early July trading, so investors will be watching for price patterns on the rise approaching that zone from now on.
However, if there is a resumption of decline, the price is expected to reach the 1.35000 level with a decline below it giving a bearish signal.
If the decline continues lower, the price is likely to re-touch the support zone at 1.34000 as was the case last week.
