GBP/USD’s strong rebound and break of 1.3174 resistance last week suggests that sideway pattern from 1.3284 has completed at 1.2977. Initial bias is back on the upside this week for 1.3284 first. Break will target 1.5314 high. On the downside, break of 1.3139 minor support will turn intraday bias neutral first.
In the bigger picture, rise from 1.1958 medium term bottom is expected to extend higher to retest 1.4376 key resistance. Reactions from there would decide whether it’s in consolidation from 1.1946 (2016 low). Or, firm break of 1.4376 will indicate long term bullish reversal. In any case, for now, outlook will stay bullish as long as 1.2582 resistance turned support holds.
In the longer term picture, it’s still unsure whether long term down trend form 2.1161 (2007 high) has completed at 1.1946 already. Focus is immediately on 55 month EMA (now at 1.3507) and sustained break will be the first serious sign of long term reversal. Further break of trend line resistance (now at 1.4045) will be another signal. Focus would then be turned to 1.4376 key resistance for confirmation.