GBP/USD Mid-Day Outlook

Daily Pivots: (S1) 1.2773; (P) 1.2846; (R1) 1.2889; More…

GBP/USD recovers after dipping to 1.2798. But we’re still favoring the case that corrective rebound from 1.2661 has completed at 1.2935 already. Further decline should be seen to retest 1.2661 low first. Break will resume larger down trend from 1.4376. On the upside, in case of another rebound, we’d still expect upside to be limited by 1.2956 support turned resistance. However, decisive break of 1.2956 will turn focus to 1.3212 key resistance instead.

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.