In today’s technical setup, we’re watching Cable (GBP/USD) closely as it tests a major long-term support zone at 1.337, marked clearly in yellow on the chart. This level has held through multiple tests and continues to act as a critical battleground between bulls and bears.
But the pressure is mounting.
Price action has recently formed a pennant formation, outlined with black trendlines. And that’s where things get tricky for the bulls — because pennants are typically trend continuation patterns, and here, the dominant trend is bearish, as shown by the green descending trendline.
So what does this mean for traders?
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A break below the lower boundary of the pennant would be a bearish signal, confirming continuation and likely triggering another test of the 1.337 horizontal support.
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A breakout below 1.337 would escalate the move into a full long-term sell signal, opening room for deeper downside.
On the flip side, a bullish breakout above the pennant and above the green downtrend line would invalidate the bearish structure. That would be a less likely scenario, but if it happens, it would signal a technical reversal and bring in a long-term buy signal.
Right now, the structure favors the sellers, but the breakout direction will decide everything. The battle at 1.337 is not over yet — but momentum is shifting.