• GBP/USD extends the previous day’s pullback towards four-month-old support line.
• Oversold RSI (14), lower line of the monthly bearish channel acts as additional downside filters.
• 10-DMA guards immediate upside, buyers need validation from July’s low.

GBP/USD holds lower grounds near the two-year bottom, marked on Monday, as bears flirt with the 1.1450 while flashing the biggest daily loss in a week. With this, the Cable pair approaches the latest low near 1.1443 heading into Wednesday’s London open.

A downward sloping support line from May, around 1.1425, appears an immediate challenge for the GBP/USD bears considering the oversold RSI (14).

Following that, the March 2020 low near 1.1410 ad the support line of a one-month-old falling channel, near 1.1380, will be in focus.

Should the GBP/USD prices drop below 1.1380, the odds of witnessing a slump towards the early 1985 levels surrounding 1.1000.

Alternatively, recovery moves remain elusive until staying below the 10-DMA resistance near 1.1610.

Also acting as an upside hurdle is the stated channel’s top, at 1.1640 by the press time.

Even if the GBP/USD bulls manage to cross the 1.1640 hurdle, July’s low of 1.1760 could challenge the upside momentum.

To sum up, GBP/USD is likely to remain on the bear’s radar but the downside room is limited.

GBP/USD: Daily chart

Limited downside expected