GBP/USD’s fall from 1.2582 extended lower last week and breached 1.2283 support. Rebound from 1.1958 could have completed at 1.2582. Initial bias is mildly on the downside this week fir retesting 1.1946 key support next. On the upside, break of 1.2582 will resume the rebound to 61.8% retracement of 1.3381 to 1.1958 at 1.2837.
In the bigger picture, we’d remain cautious on medium term bottoming around 1.1946 (2016 low). Sustained trading above 55 week EMA (now at 1.2742) will extend the consolidation pattern from 1.1946 with another rise to 1.4376 resistance. Nevertheless, decisive break of 1.1946 will resume down trend from 2.1161 (2007 high) to 61.8% projection of 1.7190 to 1.1946 from 1.4376 at 1.1135.
In the longer term picture, corrective rebound from 1.1946 (2016 low) was rejected by 55 month EMA. Long term outlook remains bearish. Firm break of 1.1946 will indicate resumption of down trend from 2.1161 (2007 high). Next target is 61.8% projection of 1.7190 to 1.1946 from 1.4376 at 1.1135.
