GBP./USD rose to as high as 1.3350 last week and the break of 1.3217 resistance suggests completion of fall from 1.4376. As a temporary top was formed, initial bias is neutral this week for some more consolidation first. But downside of retreat should be contained by 1.3109 minor support to bring another rally. On the upside, break of 1.3350 will extend the rise from 1.2391 to 61.8% retracement of 1.4376 to 1.2391 at 1.3618 next. Sustained break will pave the way to 1.4376. However, break of 1.3109 will turn focus back to 1.2773 near term support.
In the bigger picture, medium term decline from 1.4376 (2018 high) should have completed at 1.2391. Rise from 1.2391 is now seen as the third leg of the corrective pattern from 1.1946 (2016 low). Further rise could be seen through 1.4376 in medium term. On the downside, though, break of 1.2773 support will turn focus back to 1.2391 low and then 1.1946.
In the longer term picture, current development argues that corrective pattern from 1.1946 (2016 low) is extending with another rise. But there is no change in the long term bearish outlook as long as 38.2% retracement of 2.1161 (2007 high) to 1.1946 at 1.5466 holds. An eventual downside breakout through 1.1946 is still in favor in the long term.
