GBP/USD: Will today be the big breakthrough?

During the Asian session on Thursday, the GBP/USD pair rose from its recent low near 1.2110, indicating a move away from the lowest point touched since March 17. However, it remained below the mid-1.2100s, suggesting vulnerability to the persistent downtrend observed over the past two months. The Relative Strength Index (RSI) on the 4-hour chart stayed well below 30, emphasizing oversold conditions, with the GBP/USD pair slightly below the lower limit of the descending regression channel, confirming oversold conditions. Potential resistance levels for a technical correction include 1.2200, 1.2240, and 1.2300, while immediate support lies at 1.2130, followed by 1.2100 and 1.2050. The GBP/USD pair had previously surpassed 1.2200 and slid below 1.2150, remaining in oversold conditions, and investors may await a stable improvement in risk sentiment before anticipating a significant recovery. On Tuesday, major Wall Street indexes witnessed a decline of over 1% due to concerns about a US government shutdown. Despite slightly higher US stock index futures, investors may hesitate to bet on a risk rally unless Republicans and Democrats reach an agreement on a bipartisan spending bill before the Sunday deadline. Later, the US Census Bureau will release Durable Goods Orders data for August, with the market expecting a 0.5% decrease. A notable decline could have an initial negative impact on the US dollar. Furthermore, a 5-year US Treasury note auction by the US Department of Treasury is scheduled, and strong demand for bonds could weaken the US dollar. However, attention remains focused on political developments in the US. On the H4 chart, it can be observed that the price has formed a bearish channel supporting the overall trend and that the price during the Asian session has marked a swing low, the second in that zone around 1.2120. From this point, I would expect an upward movement with a structural change, and later I will look for a long entry on M15, perhaps during New York immediately after today's macroeconomic data. Let's see how the price reacts. Let me know what you think, comment, and leave a like to support our work. Greetings and happy trading to everyone from Nicola, the CEO of Forex48 Trading Academy.