GBP/USD: RSI indicates overbought conditions

The GBP/USD pair shot to fresh yearly highs near the 1.33 mark during the early European session. The cable is now trading just above the 1.3280 level, up 0.60% on the day, but Friday's daily and 4-hour charts are pointing to overbought conditions, as FXStreet’s analyst Yohay Elam notes.

Key quotes

“The Relative Strength Index on the 4-hour chart is flirting with 70, indicating overbought conditions and countering upside momentum and the fact that cable is trading above the 50, 100, and 200 Simple Moving Averages.”

“The daily high of 1.3290 is the highest since December 2019 – an eight-month high. Above this level, the next target is 1.3330, which was a peak back then. The post-elections high of 1.3510 is the next level to watch.”

“Support is at 1.3265, last week's high, followed by 1.3180, which is the daily low. It is followed by 1.3150, which capped pound/dollar on its way up.” 

“It is essential to note that the RSI on the daily chart is also approaching 70, entering overbought conditions.”