GBP/USD Mid-Day Outlook

Daily Pivots: (S1) 1.3703; (P) 1.3743; (R1) 1.3780; More….

GBP/USD recovers mildly today but stays inside range of 1.3669/3846. Intraday bias remains neutral first. We’re still slightly favoring the case that corrective pull back from 1.4240 has completed with three waves down to 1.3669, ahead of 38.2% retracement of 1.2675 to 1.4240 at 1.3642. On the upside, break of 1.3846 will extend the rebound to 1.4000 resistance and then 1.4240 high. However, sustained break of 1.3642 will turn bring deeper fall to 1.3482 resistance turned support.

In the bigger picture, rise from 1.1409 medium term bottom is in progress. Further rally would be seen to 1.4376 resistance and above. Decisive break there will carry larger bullish implications and target 38.2% retracement of 2.1161 (2007 high) to 1.1409 (2020 low) at 1.5134. On the downside, break of 1.3482 resistance turned support is needed to be first indication of completion of the rise. Otherwise, outlook will stay cautiously bullish even in case of deep pullback.