GBP/USD: Deeper Drop Is Possible

Technical Reports

Trading tone is neutral. The corrective growth from 1.2661 could have completed at 1.3297, ahead of key fibonacci level 1.3316. Pivot points are at: (S1) 1.3119; (P) 1.3157; (R1) 1.3219.

Break of resistance turned support 1.3042 will bring deeper drop to 1.2784. Hitting of 1.2784 will argue that larger downtrend from 1.4376 is resuming for a new low below 1.2661.

A medium term bounce from 1.1946 should have completed at 1.4376 already, after rejection from 55 month EMA (now at 1.4062). Overcoming of 1.3316 would bring stronger rebound to 61.8% retracement at 1.3721. Downtrend resumption is forecast. This will be the preferred case while 38.2% retracement of 1.4376 to 1.2661 at 1.3316 keeps.