The previous consolidation movement extended between the price levels of 1.5600 and 1.5770. It represented a period of indecision on the market after such a long bearish rally that started off 1.7100 and 1.6500.
Bearish breakout below 1.5550 directly exposed lower targets. Bears have already pushed towards the price levels of 1.5050 and 1.4960, which have not been visited since July 2013.
Around the price levels of 1.5050 and 1.4960 the market has established another consolidation zone, which extended up to the price levels of 1.5280.
Two weeks ago, the ongoing bearish trend was invalidated when bullish breakout above 1.5200 took place.
Estimated projection targets are located around 1.5600-1.5640 where the previous consolidation zone was located.
By the end of the last week, the GBP/USD pair has consolidated above the price zone of 1.5360 (61.8% Fibonacci level), which failed to provide enough RESISTANCE over the last bullish swing.
For the current bullish breakout to happen, bulls should keep defending the price zone of 1.5300-1.5330.
Estimated projection targets for the recent bullish breakout are roughly located around 1.5600-1.5640 where the upper limit of the depicted channel is located.
Conservative traders can wait for a low-risk SELL entry at retesting of 1.5600 (upper limit of the channel mentioned above). Stop Loss should be located above 1.5650.
The material has been provided by InstaForex Company – www.instaforex.com