GBP/USD’s down trend resumed last week and hit as low as 1.2822. Initial bias stays on the downside this week for 100% projection of 1.3641 to 1.2999 from 1.3297 at 1.2655 next. On the upside, above 1.2971 minor resistance will turn intraday bias neutral and bring consolidation first, before staging another decline.
In the bigger picture, rise from 1.1409 (2020 low) has completed at 1.4248, ahead 1.4376 long term resistance (2018 high). Decline from 1.4248 could still be a corrective move, or it could be the start of a long term down trend. In either case, deeper decline would be seen back to 61.8% retracement of 2.1161 to 1.1409 at 1.2493. In any case, break of 1.3158 support turned resistance is needed to be the first sign of medium term bottoming. Otherwise, outlook will stay bearish in case of rebound.
In the longer term picture, rebound from 1.1409 long term bottom could have completed at 1.4248 already, well ahead of 38.2% retracement of 2.1161 to 1.1409 at 1.5134. The development argues that price actions from 1.1409 are developing into a corrective pattern only. That is, long term bearishness is retained for resuming the downside from 2.1161 (2007 high) at a later stage.
