Daily Pivots: (S1) 1.3444; (P) 1.3530; (R1) 1.3602; More…
Intraday bias in GBP/USD is turned neutral with today’s recovery. On the upside, break of 1.3617 minor resistance will indicate short term bottoming at 1.3459, just ahead of 1.3448 fibonacci level. In that case, stronger rebound would be seen back to 38.2% retracement of 1.4376 to 1.3459 at 1.3809. We’d expect strong resistance from there to limit upside. On the downside, sustained break of 1.3448 fibonacci level will confirm resumption of whole fall from 1.4376 and target next fibonacci level at 1.2874.
In the bigger picture, current development suggests that whole medium term rebound from 1.1936 (2016 low) has completed at 1.4376 already, with trend line broken, on bearish divergence condition in daily MACD, after rejection from 55 month EMA (now at 1.4223). Deeper decline should be seen to 38.2% retracement of 1.1936 (2016 low) to 1.4376 at 1.3448 first. Break will target 61.8% retracement at 1.2874 and below. Outlook will stay bearish as long as 55 day EMA (now at 1.3925) holds, even in case of strong rebound.
