GBP/USD Mid-Day Outlook

Daily Pivots: (S1) 1.2713; (P) 1.2735; (R1) 1.2771; More…

GBP/USD’s recovery from 1.2661 temporary low extends higher today. But it’s capped well below 1.2826 minor resistance. Intraday bias remains neutral with further fall expected. On the downside, break of 1.2661 will resume the whole fall from 1.4376 and target 161.8% projection of 1.3362 to 1.2956 from 1.3212 at 1.2555. Though, break of 1.2826 will indicate short term bottoming on bullish convergence condition in 4 hour MACD. And that would bring stronger rebound and lengthier consolidation first.

In the bigger picture, whole medium term rebound from 1.1946 (2016 low) should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4091). Current downside acceleration argues that it’s possibly resuming long term down trend. In any case, outlook will stay bearish as long as 1.3212 resistance holds. Retest of 1.1946 should be seen next.