GBP/USD Daily Outlook

Daily Pivots: (S1) 1.6273; (P) 1.6393; (R1) 1.6467; More

GBP/USD dips further to as low as 1.6207 so far but is still holding above 1.6185 support. We'd prefer to continue to stay neutral for the moment. Though, a break below 1.6185 will flip intraday bias back to the downside for testing 1.5801 support first. Break there will revive the case that GBP/USD has topped out earlier at 1.6661 and will turn outlook bearish for deeper fall. On the upside, note that break of 1.6617/6661 resistance zone will confirm that whole rise from 1.3654 has resumed. But upside momentum should continue to diminish as GBP/USD approaches 61.8% projection of 1.4395 to 1.6661 from 1.5801 at 1.7201 and bring reversal finally.

In the bigger picture, rise from 1.3654 is treated as the third leg of the correction that started at 1.3503, which correct the larger down trend from 2.1161. Such rally from 1.3654 should be in the last stage after meeting target zone of 1.6428/7332 (38.2% and 50% retracement of 2.1161 to 1.3503). Focus will remain on reversal signal as we'd expect the whole correction from 1.3503 to conclude here. On the downside, firm break of 1.5801 support will now be an important signal that the whole correction has finally completed and will turn focus to next key support of 1.4984 for confirmation.

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