Daily Pivots: (S1) 1.3178; (P) 1.3271; (R1) 1.3350; More…
GBP/USD dropped sharply to as low as 1.3189 and breached 1.3200 minor support. But the pair quickly recovered and intraday bias is now neutral first. On the downside, break of 1.3189 should confirm that corrective rise from 1.3048 has completed at 1.3362. And intraday bias will be turned to the downside for 1.3048 first. Break will resume larger fall from 1.4376 for 1.2874 fibonacci level next. In case of another rise through 1.3362, we’d expect strong resistance from 1.3471 to limit upside to finish the corrective rebound.
In the bigger picture, whole medium term rebound from 1.1936 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4179). Fall from 1.4376 should extend to 61.8% retracement of 1.1936 (2016 low) to 1.4376 at 1.2874 next. We’ll pay attention to the reaction from there to asses the chance of long term down trend resumption. On the upside, sustained break of 38.2% retracement of 1.4376 to 1.3048 at 1.3555 is needed to indicate medium term bottoming. Otherwise, outlook will remain bearish in case of strong rebound.
