Technical Market Overview:
The GBP/USD pair has retraced around 50% of the last wave down, but the corrective bounce was capped at the level of 1.2988 and the Bearish Engulfing pattern had been made. Since then the price returned to the down move, but the local trendline has not been broken yet. The breakout from the recent range might be the beginning of a larger correction to the downside and the next target for bears is seen at the level of 1.2823. In the meantime, the next technical resistance for the bouncing price is seen at the level of 1.2988 and the local support is seen at the level of 1.2939.
Weekly Pivot Points:
WR3 - 1.3353
WR2 - 1.3269
WR1 - 1.3041
Weekly Pivot - 1.2956
WS1 - 1.2722
WS2 - 1.2624
WS3 - 1.2379
Trading Recommendations:
The best strategy for current market conditions is to trade with the larger timeframe trend, which is up, so all downward market moves will be treated as local corrections in the uptrend. In order to reverse the trend from up to down in the longer term, the key level for bulls is seen at 1.2756 and it must be clearly violated. The key long-term technical support is seen at the level of 1.2231 - 1.2224 and the key long-term technical resistance is located at the level of 1.3512.
