GBP/USD Price Forecast: Tests seven-month lows below 1.2500

• GBP/USD tests its seven-month low at 1.2487.
• An upward correction would be indicated once the 14-day RSI breaks below the 30 mark.
• The primary resistance zone appears around its nine-day EMA at 1.2606, followed by the descending channel's upper boundary.

GBP/USD continues to lose ground for the third consecutive day, trading around 1.2490 during the Asian hours on Friday. The daily chart analysis suggests an ongoing bearish bias as the pair is confined within the descending channel pattern.

However, the 14-day Relative Strength Index (RSI) falls to near the 30 level, suggesting a strengthening of a bearish bias. A decisive break below the 30 mark would indicate an oversold situation and a potential for an upward correction soon.

On the downside, the GBP/USD pair hovers around its seven-month low at 1.2487, recorded on November 22. A successful break below this level could amplify bearish momentum, potentially driving the pair toward its yearly low at 1.2299, last seen on April 22, followed by the lower boundary of the descending channel 1.2260 level.

Regarding resistance, the GBP/USD pair may revisit its nine-day Exponential Moving Average (EMA) at 1.2606, followed by the 14-day EMA at 1.2635, aligned with the descending channel's upper boundary. A successful break above this critical region could weaken the bearish bias, paving the way for a move toward the five-week high of 1.2811, marked on December 6.

GBP/USD: Daily Chart