GBP/USD Price Analysis: Eyes a rally towards 1.3800, with bull pennant in play

• GBP/USD breaks the consolidation to the upside, 1.38 in focus.
• The cable confirmed a bull pennant breakout on the hourly sticks.
• RSI remains flatlined but holds well above the midline.

GBP/USD is looking to extend its break higher towards the 1.3800 level, with the bulls likely to meet initial demand at the slightly downward-sloping 200-Hourly Moving Average (HMA) at 1.3779.

The upside bias appears more compelling, as the cable has charted a bull pennant breakout on the hourly sticks, following a sustained break above the rising trendline resistance at 1.3709.

The Relative Strength Index (RSI) is holding flattish but comfortably above the midline, suggesting that there is more room for the bulls to flex their muscles.

An impending bull cross, with the 21-HMA about to cut the 100-HMA from below, also adds credence to the move higher.

GBP/USD: Hourly chart

Alternatively, a sustained break below the 1.3705 would invalidate the bullish continuation pattern, opening floors towards a test of the downward-pointing 100-HMA at 1.3698.

The 1.3650 psychological level will be next on the sellers’ radars.

GBP/USD: Additional levels