GBP/USD Mid-Day Outlook

Daily Pivots: (S1) 1.2977; (P) 1.3055; (R1) 1.3093; More…

Intraday bias in GBP/USD remains on the downside for 1.2921 support first. Firm break there will target a test on 1.2661 low. On the upside, above 1.3131 minor resistance will turn bias to the upside for another rise. But still, price actions from 1.2661 are viewed as a corrective pattern. In case of another rise, upside should be limited by 1.3316 key fibonacci level to bring down trend resumption eventually.

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. The structure and momentum of the fall from 1.4376 argues that it’s resuming long term down trend. And this will be the preferred case as long as 38.2% retracement of 1.4376 to 1.2661 at 1.3316 holds. However, firm break of 1.3316 would bring stronger rebound to 61.8% retracement at 1.3721. And, the eventual depth of the fall from 1.4376, and the chance of hitting 1.1946 low, will depend on the strength of the interim corrective rebound from 1.2661.