GBP/USD: Close to overbought territory, upside potential limited

Monday's 4-hour chart is showing nearly overbought conditions which limits the potential for further gains, Yohay Elam, an analyst at FXStreet, briefs.

See: GBP/USD could move higher to 1.2800 – UOB

Key quotes

“Momentum on the 4-hour chart is somewhat weaker and the Relative Strength Index is close to 70 – nearing overbought conditions. That implies that the room for gains is limited, yet bulls remain in control.”

“Resistance awaits at 1.2730, the daily high, and also Friday's peak. It is followed by 1.2780 and 1.2845, levels that were in play early in the year.” 

“Support is at 1.2645, the former double-top seen in previous months. It is closely followed by 1.2615, which capped the pair last week, and then by 1.2575, a support line before the latest rise.”