GBP/USD has extended rally to a fresh monthly high. According to FXStreet’s Eren Sengezer, the cable could stage a correction before the next leg higher.

Buyers look to remain in control while above 1.3330

“On the four-hour chart, the Relative Strength Index (RSI) indicator climbed above 70 for the first time since October 19, showing overbought conditions. The last time that happened, GBP/USD staged a correction before regaining its traction and a similar action could be expected.”

“The 200-period SMA forms the first support at 1.3330 and as long as the pair holds above that level, buyers could look to remain in control. 1.3400 (psychological level) aligns as the first target before 1.3440 (static level) and 1.3470 (static level).”

“Below 1.3330, 1.3300 (psychological level) is the next support before 1.3260 (100-period SMA, 50-period SMA).”