In the period between December 18th – 23rd, bearish breakout below the previous bullish channel followed by quick bearish decline below 1.3000 were demonstrated on the H4 chart.
However, Immediate bullish recovery (around 1.2900) brought the pair back towards 1.3250 (backside of the broken channel) where the recently-terminated wide-ranged movement channel was established below 1.3200.
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 breakout 1.2780 took place.
Shortly after, significant bullish rejection was demonstrated around 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 (As depicted on the Weekly Chart).
Recently, the GBP/USD pair looked very OVERSOLD around the price levels of 1.1450 where a double-bottom reversal pattern is being demonstrated.
Technical outlook will probably turn into bullish if bullish persistence is maintained above 1.1650 – 1.1700 on the H4 Charts.
Bullish breakout above 1.1900 (Latest Descending High) invalidates the ongoing bearish scenario temporarily & enables higher bullish targets around 1.2260, 1.2520, 1.2680 to be addressed if sufficient bullish momentum is maintained.
On the other hand, H4 Candlestick closure below 1.1450 & Weekly Candlestick closure below 1.1650 enhances the bearish momentum on both the short and intermediate-terms respectively.
Initial Bearish targets would be located around 1.1350 and 1.1180 provided that quick H4 bearish closure below 1.1450 is achieved.
The material has been provided by InstaForex Company – www.instaforex.com