FX.co ★ GBP/USD

Currency pair GBPUSD - D1 chart. As seen, last April showed a rapid growth. The bullish divergence on the MACD indicator and the double bottom reversal pattern on the chart warned about this growth. Additionally, some interim decisions regarding Iran occurred, causing the US dollar to weaken in the market. The price reached the horizontal resistance level at 1.3458, tapped the peak, and then immediately dropped back down. This was followed by profit-taking and new selling, leading to the price decrease. Later, the price quickly rose back up to significantly surpass the previous peak. Applying a Fibonacci retracement to the downward movement since the end of January this year, it can be observed that the price reached the deepest correction level of 61.8. The second wave often ends at this level before the third wave down. This could be the case here as well, marking the second wave of the weekly period. Position liquidation occurred, causing the price to start falling. Additionally, the CCI indicator was exiting the overbought zone at that time. A descent to the horizontal support level at 1.3458 was expected, which indeed happened. Initially, the price hesitated near this level, then tested it for real, followed by a bounce off the level and a rising candle. It was anticipated that the level would be broken downwards, turning into resistance, increasing the likelihood of the third wave of the larger weekly period. Furthermore, a breakout of the ascending wedge downwards gave more strength to the sellers, pushing the price significantly lower. The level at 1.3312 was reached, from which the upward movement resumed. It was expected that the decline would resume from the resistance level at 1.3458. For several days, the price attempted to move down from it, but ultimately broke through and reached the level of 1.3515. I assume this is the second wave, and it is likely to end in this area. So far, it seems to be playing out as expected, with the price confidently dropping from the recent peak, indicating an expected continuation of the decline. An additional bearish engulfing factor is the candlestick pattern after the completion of the second wave.

H4 chart. The price didn't want to drop down directly, it paused and made a correction. This is even better, as it allows for entering a short position at a better price, which seems like a good opportunity in my opinion. I anticipate a pullback as the second wave, with the minimum target being yesterday's low. Although we might not reach it today, everything seems stuck here for now.