Since May 17, the depicted sideway consolidation range has been established between 1.2750 – 1.2570.
On June 4, temporary bullish breakout above 1.2650 was demonstrated for a few trading sessions.
This enhanced the bullish side of the market towards 1.2750 (consolidation range upper limit) which has been preventing further bullish advancement up till now.
On June 14, recent temporary bearish decline was demonstrated below 1.2600 hindering the mentioned bullish scenario for some time before bullish breakout could be re-achieved last week.
For the bullish side of the market to remain dominant, bullish persistence above 1.2750 (consolidation range upper limit ) should be achieved by the bulls.
Bullish breakout above 1.2750 is mandatory to bring further bullish advancement towards 1.2840 and 1.2900.
Recently, the GBP/USD failed to establish a successful bullish breakout above 1.2750. Instead, early signs of bearish rejection have been manifested (Head & Shoulders reversal pattern with neckline located around 1.2650).
A quick bearish pullback towards 1.2650 was expected shortly.
Bearish breakdown below 1.2650 (reversal pattern neckline) confirms the reversal pattern with bearish projection target located at 1.2510.
However, For conservative traders, SELL positions shouldn’t be considered around the current price levels unless bearish breakout below 1.2570 becomes confirmed on higher timeframes (which is low probability).
On the other hand, a bullish position is preferred around the current price levels. Bullish breakout above 1.2750 is mandatory as a valid BUY signal.
Intraday traders can have a valid BUY Entry upon bullish breakout above 1.2750.
T/P levels to be located around 1.2840, 1.2900 and 1.2940. S/L should be placed below 1.2680.