FX.co ★ Technical analysis of GBP/USD for December 23, 2016

GBP/USD has broken support at 1.23 and is heading towards our next targeted support area of 1.22-1.2150. The trend remains bearish, but the downside move is very close to completion.

The price is making lower lows and lower highs. The oscillators are not making new lows and this is a bullish divergence. The short-term target for GBP/USD is the 1.2250 level. The short-term resistance is at 1.23.

Red lines - channel

Green line - horizontal support

The GBP/USD pair has broken out and below the red channel and is heading towards the green trend line. I am not sure if we are going to reach it, but the trend remains strongly bearish. Only a move back above 1.23 and a daily close above it will be a bullish short-term signal. For a larger bullish reversal to occur, the GBP/USD pair should move higher than 1.25 levels.