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 terminated when bullish breakout above 1.5200 took place, as depicted on the chart. Since then, the GBP/USD pair has been trending upwards within the depicted bullish channel.
Estimated projection targets are located around 1.5600-1.5640 where the previous consolidation zone was located. However, earlier, around 1.5550 bears have applied significant bearish pressure resulting in the formation of a bearish engulfing daily candlestick without further retesting of 1.5600.
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 persist, bulls should keep defending the price zone of 1.5300-1.5330 that is being approached today.
Estimated projection targets for the recent bullish breakout are roughly located around 1.5600-1.5640, which have not been tested yet.
On the other hand, the price action should be watched around the price zone of 1.5350-1.5300 to determine the next destination of the GBP/USD pair.
Bearish breakdown of 1.5300 should not be excluded, especially after the obvious bearish engulfing candlestick of yesterday.
The material has been provided by InstaForex Company – www.instaforex.com