The price zone between 1.3845 and 1.3550 (Historical bottoms in January 2009) was considered a significant demand zone to be watched for bullish recovery.
However, by the end of June, a significant bearish breakdown below 1.3550 was expressed as seen on the depicted charts (Fundamental Reasons).
Bearish persistence below the demand level at 1.3550 enhanced the bearish scenario towards the current price levels around 1.2700 (nearest bearish projection target).
Today, price action should be watched for a short-term BUY entry. Initial bullish targets should be located at 1.2800 and 1.2900. S/L is recommended to be set as daily closure below 1.2700.
Note that the GBP/USD pair remains trapped inside the depicted consolidation range between 1.2700 and 1.3550 until breakout occurs in either direction.
On the other hand, daily persistence below 1.2700 confirms a bearish Flag pattern. Bearish projection target would be located around 1.2020 if enough bearish pressure is maintained below 1.2700.
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