Since January 13, progressive bearish pressure has been built above the price level of 1.2780-1.2800 until March the 2nd when transient bearish consolidation below 1.2780 took place within the depicted wide-ranged slightly bearish channel.
Shortly after, significant bullish rejection was demonstrated around 1.2780 on March 4. Hence, a quick bullish movement was expressed towards the price zone of 1.3165-1.3200 where significant bearish pressure brought the pair back below 1.2780, 1.2500 then 1.2260 via quick bearish engulfing H4 candlesticks.
Recently, the GBPUSD has reached new LOW price levels around 1.1450, slightly below the historical low (1.1650) achieved in September 2016.
Recently, the GBP/USD pair looked very OVERSOLD around the price levels of 1.1450 where a double-bottom reversal pattern was recently demonstrated.
Technical outlook will probably remain bullish if bullish persistence is maintained above 1.1890-1.1900 (Double-Bottom Neckline) on the H4 Charts.
Bullish breakout above 1.1900 (Latest Descending High) invalidated the bearish scenario temporarily & enabled a quick bullish movement to occur towards 1.2260.
Next bullish targets around 1.2520 and 1.2680 are expected to be addressed if sufficient bullish momentum is maintained.
On the other hand, H4 Candlestick re-closure below 1.2265 hinders further bullish advancement and enhances the bearish momentum on the short term.
If so, Initial Bearish target would be located around 1.1900 provided that quick H4 bearish closure below 1.2265 is achieved.
Trade recommendations :
Conservative traders should be waiting either for more bullish advancement towards the price zone of 1.2520 – 1.2600 looking for signs of bearish rejection or early bearish closure below 1.2265 as a valid SELL signal.
T/P level to be located around 1.2265 initially while S/L should remain above 1.2630.