Since May 17, the previous downside movement within the depicted bearish channel came to a pause allowing the recent sideway consolidation range to be established between 1.2750 - 1.2550 with a prominent key-level around 1.2650.
Moreover, signs of bearish rejection have been manifested near 1.2750 (Head & Shoulders reversal pattern with neckline located around 1.2650).
Bearish breakdown below 1.2650 (reversal pattern neckline) confirmed the reversal pattern with bearish projection target located at 1.2550, 1.2510 and 1.2450.
Intermediate-term technical outlook remains under bearish pressure as long as the market keeps moving below 1.2550 (the lower limit of the depicted consolidation range).
In July 18, a recent bullish movement was initiated around 1.2385 (the lower limit of the depicted movement channel).
A bullish pullback was demonstrated towards the backside of the broken consolidation range (1.2550) where another valid SELL entry was offered by the end of last week's consolidations.
Bearish persistence below 1.2460 (38.2% Fibonacci levels) was mandatory to ensure further bearish decline.
However, lack of sufficient bearish momentum was demonstrated around 1.2430 (38.2% Fibonacci Level).
That's why, another bullish pullback is currently being demonstrated towards 1.2500 (61.8% Fibonacci level) which constitutes a prominent Intraday Supply Level to be watched for bearish rejection & another SELL Entry.
Bearish breakdown below 1.2430 (38.2% Fibonacci Level) is mandatory to allow further bearish decline towards 1.2360 where the lower limit of the depicted movement channel comes to meet the GBP/USD pair.
Moreover, Bearish breakdown below 1.2360 is needed to facilitate further bearish decline towards 1.2320 and 1.2270 which correspond to significant key-levels on the Weekly chart.
On the other hand, please note that any bullish breakout above 1.2560 invalidates the previously mentioned bearish scenario.
Trade Recommendations:
For traders who missed the initial trade, another SELL Entry can be taken upon the current bullish pullback towards 1.2500.
Initial T/P levels to be located around 1.2430 and 1.2360 while S/L should be placed above 1.2560.
