The GBP/USD pair has been moving downwards below the depicted downtrend line since July 15 when extensive bearish impulse was initiated.
Many bearish impulses were previously initiated around 1.7180, 1.6630 and 1.6400 where the downtrend line came to meet the pair then.
The price zone of 1.6060 – 1.6090 constituted a weekly support that paused the bearish movement for a few days after September 9. However, the bears quickly managed to push below the price level of 1.6060.
A new bearish impulse was applied after retracement towards the price zone of 1.6350-1.6400 took place.
As suggested, the price level of 1.5890 provided evident bullish recovery. A bullish engulfing daily candlestick is manifest on the chart.
Recently, the bulls has pushed above the downtrend line. Bullish breakout is already manifest on the chart. Bullish fixation above 1.6090 is a must to enhance the bullish scenario.
This will probably liberate a strong bullish swing towards 1.6250 initially.
Bullish fixation above 1.6090 ( the broken trend line ) indicates a valid BUY entry towards 1.6250 and 1.6310. Stop Loss should be located below 1.6015.
The material has been provided by InstaForex Company – www.instaforex.com