GBP/USD Mid-Day Outlook

Daily Pivots: (S1) 1.7277; (P) 1.7496; (R1) 1.7660; More

Despite edging lower to 1.7318, GBP/USD lacks follow through selling and recovers strongly. An intraday low is in place and further recovery should be seen. Though, consolidation should be relatively brief as long as 1.7841 resistance holds. Further decline is still expected to next short term target of 61.8% projection of 2.158 to 1.7445 from 1.8668 at 1.6991, which is close to 1.7 psychological support. However, above 1.7841 will suggest that a short term bottom is formed and bring stronger rebound.

In the bigger picture, as mentioned before, the rebound from 1.7445, which is treated as correction to down trend from 2.1161 only, have completed after meeting target of 1.8512/8794 resistance zone and was limited below key near term resistance of 1.8794 (50% retracement of 2.0158 to 1.7445 at 1.8802). Medium term outlook remains unchanged. Fall from 2.1161 (07 high) is expected to developing into a five wave decline before making a medium term bottom. Sustained break of 1.7421/45 support zone will confirm that this fall has resumed for next target of 61.8% retracement of 1.3680 to 2.1161 at 1.6538 first. Break of 1.8668 resistance is needed before considering whether a medium term bottom is formed.

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