GBP/USD has reversed its direction after having tested 1.2000 earlier in the day. The pair could extend recovery if 1.2050 support holds, FXStreet’s Eren Sengezer reports.

GBP/USD could test 1.2000 if sellers flip 1.2050 into resistance

“In case the market mood improves and Wall Street's main indexes rise decisively following Wednesday's decline, GBP/USD could gather bullish momentum and stretch higher and vice versa.”

“GBP/USD was last seen trading above 1.2050. As long as this level holds, additional gains toward 1.2100 (Fibonacci 38.2% retracement) and 1.2130 (100-period SMA) and 1.2175 (Fibonacci 23.6% retracement) could be witnessed.”

“On the downside, GBP/USD could test 1.2000 (daily low, psychological level, Fibonacci 61.8% retracement) if sellers flip 1.2050 into resistance. Below 1.2000, 1.1940 (static level) could be seen as the next bearish target.”