FX.co ★ LaibaBatool | GBP/USD

Technical Price Action Analysis 1. The Liquidity Sweep and Reversal Around the 12:00 mark, the price formed a decisive bottom. After a final push lower labeled with a BOS (Break of Structure) to the downside, the momentum shifted abruptly. This is the hallmark of a "Spring" or a stop-hunt. The rapid recovery that followed immediately challenged the previous swing highs, indicating that buyers had taken full control of the order flow. 2. Market Structure Shift (MSS) The most critical turning point in this setup is the MSS identified near the 1.3380 level. As the price surged upward, it aggressively broke through the previous lower-high resistance. This shift from a bearish structure to a bullish one confirms that the "path of least resistance" has flipped to the upside. The magnitude of the candles during this displacement—large, full-bodied green marubozu candles—suggests strong institutional participation and a lack of selling pressure. 3. Consolidation and Further Breakout After the initial impulsive move, the price entered a brief period of consolidation between 1.3380 and 1.3400. During this phase, the market successfully retested the previous MSS zone, which now serves as a support base. The subsequent BOS to the upside above 1.3410 reinforces the bullish continuation, signaling that the market is ready to target higher liquidity pools in the 1.3420+ range. Proposed Trade Setup Based on the current bullish momentum and the structural confirmation seen on the M15 chart, the following trade setup is considered: * Entry Strategy: Look for a minor retracement (a "Fair Value Gap" or "Order Block" retest) back toward the 1.3395 – 1.3405 zone. Entering on a pull-back allows for a better risk-to-reward ratio rather than chasing the current peak. * Stop Loss (SL): The stop loss should be placed safely below the most recent higher low or the MSS level, specifically around 1.3375. This protects the capital in case the structural shift fails and the market resumes its previous bearish trend. * Take Profit (TP): The primary target is the recent swing high and the psychological resistance at 1.3420. If momentum remains strong, a secondary target could be extended to 1.3450, trailing the stop loss to lock in profits as the trend develops. Conclusion The GBP/USD chart illustrates a textbook reversal pattern. By identifying the trap set below 1.3340 and waiting for the Market Structure Shift, a high-probability long setup has emerged. The surge in volume and price displacement indicates that the bulls are currently in command. Traders should remain patient for a technical retest of the breakout zone to ensure an optimized entry while keeping a close eye on the 1.3420 resistance level.