GBP/USD: Stubborn resistance at 1.3440 caps the rally

GBP/USD has lost its bullish momentum following last week's climb. Strong resistance seems to have formed at 1.3440, therefore, further gains are not expected while the cable trades below this level.

Pound rally loses steam

“In case profit-taking comes into play and starts weighing on stocks, we could see GBP/USD starting to edge lower amid renewed greenback strength.”

“Strong static resistance seems to have formed at 1.3440 and buyers are unlikely to show interest in the pair unless it managed to close a four-hour candle above that level. In case that happens, 1.3475 (static level) aligns as the next hurdle before 1.3500 (psychological level).”

“1.3320 (200-period SMA) and 1.3300 (psychological level, 50-period SMA) could be targeted if the pair drops below 1.3370 (lower limit of the range, former resistance) and flips that level into resistance.”