Intermediate-term Technical outlook for the GBP/USD pair remains bullish as long as bullish persistence is maintained above 1.1890-1.1900 (Double-Bottom Neckline) on the H4 Charts.
Recently, Bullish persistence above 1.2265 has enhanced another bullish movement up to the price levels of 1.2520-1.2590 where significant bearish rejection as well as a quick bearish decline were previously demonstrated (In the period between 14th - 21 April).
Currently, Atypical Bearish Head & Shoulders reversal pattern may be in progress. The pair may be demonstrating the right Shoulder of the pattern.
Hence, Bearish persistence below 1.2265 (Reversal Pattern Neckline) is needed to enhance another bearish movement towards 1.2100, 1.2000 then 1.1920. However, recent bullish price action brought the GBP/USD pair back towards 1.2600 where evident bearish rejection was manifested as we expected in previous articles.
By the end of Last Week, Intraday traders were advised to wait for bearish pullback towards the price levels of 1.2300-1.2280 where a low-risk short-term BUY trade could be taken.
The price zone of 1.2300-1.2280 still stands as a prominent Intraday Demand Zone to be watched for bullish price action and a valid short-term BUY trade.
For Previous BUYERs, bullish targets are expected to be reached initially around the price levels around 1.2450 then 1.2520 Provided that Bullish persistence above 1.2265 is maintained on the H4 chart.
However, the recently demonstrated Lower High around 1.2440 endangers the previously-mentioned short-term bullish scenario. Thus, intraday traders should be careful for upcoming price action.
That's why, any bearish breakdown below 1.2265 should be taken into consideration as it confirms the previously-mentioned reversal-top pattern.
Hence, This would probably enable further bearish decline eventually towards 1.2020 as a projection target for the reversal pattern.
Trade recommendations :
Intraday traders are advised to look for signs of bullish rejection around the current price levels of 1.2300-1.2280 where a low-risk BUY trade can be offered.
Bullish targets are located around the price levels around 1.2450, 1.2520 and 1.2600 while S/L should be placed just below 1.2250.
