Weekly
   •   Last Candlesticks pattern: Shooting star
   •   Time of formation: 31 Jul 2017
   •   Trend bias: Down
Daily
   •   Last Candlesticks pattern: Morning star
   •   Time of formation: 25 Aug 2017
   •   Trend bias: Near term up
GBP/USD – 1.3215
Although cable fell marginally to 1.3088 late last week, lack of follow through selling and the subsequent rebound suggest further consolidation would be seen and recovery to 1.3240-45 (61.8% Fibonacci retracement of 1.3338-1.3088), however, resistance at 1.3287 should limit upside and bring another decline later. Below said support at 1.3088 would extend the fall from 1.3388 to 1.3075 but break there is needed to signal decline from 1.3658 top has resumed and bring retest of 1.3027 but only break there would retain bearishness and extend this move to 1.3000, then towards 1.2940-50.
On the upside whilst recovery to 1.3240-45 cannot be ruled out, resistance at 1.3287 should hold and bring another decline. A daily close above said resistance at 1.3287 would suggest the retreat from 1.3338 has ended, bring another test of this level but a daily close above the Kijun-Sen (now at 1.3343) is needed to suggest the fall from 1.3658 has ended, bring a stronger rebound to 1.3400, then test of previous resistance at 1.3455 which is likely to hold on first testing.
Recommendation: Stand aside for this week. Â
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On the weekly chart, cable remained confined within early established range and further consolidation would be seen and as the pair found support at 1.3088 and recovered, initial bounce to 1.3240-45 and possibly 1.3287 cannot be ruled out, however, reckon upside would be limited to 1.3338 and bring another decline later. Only a sustained breach above this level would suggest the retreat from 1.3658 has ended instead, bring further gain to 1.3400-05 but still reckon upside would be limited to 1.3505-10 and bring another leg of corrective decline later. In the event sterling breaks above 1.3571 resistance, this would signal the pullback from 1.3658 has ended, risk retest of this last month’s high, break there would extend recent erratic rise from 1.1986 low to 1.3750-60 and 1.3800 but overbought condition should prevent sharp move beyond 1.3860 (61.8% Fibonacci retracement of 1.5018-1.1986).
On the downside, expect pullback to be limited to 1.3130-35 and said support at 1.3088 should hold, bring another rebound. A weekly close below 1.3088 support would signal the rebound from 1.3027 low has ended, bring retest of 1.3027, break of this support would add credence to our view that top has been formed at 1.3658, bring further fall to 1.3000, then towards support at 1.2909, however, anticipated near term oversold condition should prevent sharp fall below previous chart support at 1.2774 and price should stay well above another previous chart support at 1.2589, bring rebound later.


