FX.co ★ Farhan Ali Shakir | GBP/USD

For GBP/USD today, the market began with a slight gap, which has since been filled, and the price is undergoing a gradual change in an upward direction. I continue to expect a resumption of southward movement during the European or American trading sessions. I am keeping a close watch on the nearest support level, which, according to my analysis, is at 1.20371. In proximity to this support level, two scenarios may unfold. The primary scenario entails price consolidation below this level, leading to further southward progression. In such an event, I will observe for the price to reach the support level at 1.18410. Here, I will await the formation of a trading signal to guide future trading decisions. While there is a possibility of targeting a more distant southern aim at 1.16454 based on my assessments, this outcome is contingent on the developing news backdrop as the price develops. An alternate scenario involves price action near the support level of 1.20371, where a reversal pattern materializes, leading to an upswing. In this scenario, I will expect a price return to the resistance level at 1.23374, or even to the resistance level at 1.25480. Around these resistance levels, I will maintain vigilance for potential indications of a shift towards a renewed southward trajectory. In summary, I envisage a resumption of southward movement following the conclusion of the minor northward change. For now, my focus remains on the closest support level, with my trading decisions contingent on the developing market conditions.

Last Friday, buyers attempted to rally the GBP/USD pair, reaching the liquidity accumulation zone between 1.2213 and 1.2224. However, challenges arose with breaking through this zone, and despite the substantial and increasing volumes during the test, the bulls were struggling. The current market seems to be inundated with sellers, and the consolidation below the 1.2169 support level at the close of the trading week points towards a potential wave of new sales. My bias leans towards selling, and today I’ll be on the lookout for the GBP/USD pair to first retest the breached resistance level at 1.2169. Following this, I expect a rebound, signaling a continuation of the descent towards targets near 1.2099.