A bearish breakout below 1.5550 exposed lower targets. Bears have already pushed towards the price levels of 1.5050 and 1.4960 where the market has established another consolidation zone, which extended up to the price level of 1.5280.
This was followed by a transient uptrend maintained within the depicted channel. Bulls managed to push towards higher levels including 1.5550 (just below the weekly supply level).
Significant bearish pressure was applied around 1.5550 resulting in formation of multiple bearish engulfing daily candlesticks.
Demand level located around 1.5200-1.5230 was breached last week indicating a strong bearish tendency on the market. It is expected to provide significant supply at retesting.
GBP/USD bulls failed to defend their demand zone of 1.5170-1.5220, especially after the obvious bearish pressure that originated last week.
A quick bearish decline towards 1.5080 and 1.5000 took place shortly after the bearish breakdown of 1.5170.
Conservative traders should wait for a bullish pullback towards the price zone of 1.5000-1.5030 (recently established supply zone) for a low-risk sell entry. Stop loss should be located above 1.5130.
On the other hand, H4 persistence below the recent bottom at 1.4900-1.4890 enhances a further bearish decline. An initial bearish target would be located at 1.4800 (historical low).
The material has been provided by InstaForex Company – www.instaforex.com