The GBP/USD stopped its bearish momentum at the support (blue) trend line of the downtrend channel, which is a new decision zone for a breakout or bounce.
The GBP/USD has reached the 78.6% Fibonacci target. A bearish breakout could see price fall below the channel towards the 100% Fibonacci target whereas a strong bullish bounce could indicate the end of the wave C (green) pattern.
The GBP/USD is probably building a bullish wave 4 (green). This wave pattern remains valid as long as price stays below the Fibonacci levels of wave 4 vs 3. A bearish breakout below the support trend line (blue) could see a wave 5 develop to complete potential wave C(green). A break above the 50% Fibonacci level makes a wave 4 (orange) less likely.
