Last week, the GBP/USD pair found intraday DEMAND around 1.5550 where many lows were previously established back in November.
Moreover, previous multiple bottoms were established above 1.5550-1.5580, rendering it a prominent DEMAND zone.
The DAILY outlook favors the bullish scenario initially towards 1.5800, then towards 1.6920 (previous consolidation range low) provided that bulls keep defending the lower limit of the current consolidation range around 1.5550.
Another less probable scenario: a bearish flag pattern that waits for a bearish breakout below 1.5550 (similar to what happened back in October). Projection target would be located around the price level of 1.5200.
The current outlook is bearish on the 4H chart. Successive lower highs and lows have been established before the current ranging movement started to occur.
A consolidation movement ranging between the price levels of 1.5770 and 1.5550 took place. It represents state of indecision in the market after such a long bearish rally that started off 1.7100 and 1.6500.
Intraday traders should wait for bullish pull-back towards the recent SUPPLY zone located around 1.5775-1.5810 for a low-risk SHORT position.
Risky traders should note that bearish breakout below 1.5550 directly exposes potential bearish projection targets around 1.5330.
The material has been provided by InstaForex Company – www.instaforex.com