GBP/USD PRICE ANALYSIS: BULLS TURN CAUTIOUS AMID OVERBOUGHT RSI, DOWNSIDE POTENTIAL SEEMS LIMITED
- GBP/USD edges lower on Thursday amid the emergence of some USD buying.
- A slightly overbought RSI is seen holding back bulls from placing fresh bets.
- The technical setup suggests that the path of least resistance is to the upside.
The GBP/USD pair trades with a mild negative bias during the Asian session on Thursday, albeit lacks follow-through selling and remains well within the striking distance of the one-year peak touched the previous day. Spot prices currently hover around the 1.3000 psychological mark and seem poised to prolong the recent uptrend witnessed over the past three weeks or so.
A modest pickup in the US Treasury bond yields assists the US Dollar (USD) in recovering a part of the previous day's heavy losses to a nearly four-month low, which, in turn, is seen acting as a headwind for the GBP/USD pair. That said, growing acceptance that the Federal Reserve (Fed) will start the rate-cutting cycle in September, along with the underlying strong bullish tone across the global equity markets, might cap the upside for the safe-haven Greenback.
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