GBP/USD has changed little in the last hours, but the outlook is bullish and the pair could still approach and reach the near-term resistance levels. The price is located at 1.2842 level, below the 1.2858 former high, the upside could continue in the short term as the USD is weakened by the USDX's sell-off.
The pair is expected to approach and reach the 1.29 psychological level in the upcoming hours, right now we don't have any bearish signal.
The valid breakout above the 150% Fibonacci line and above the R1 (1.2725) level has validated a stronger upside momentum, the median line (ML) could be used as the next upside target.
The median line (ML) acts as a magnet and attracts the price after the rejection from the 50% Fibonacci line of the ascending pitchfork. GBP/USD is traded within an up channel, between the 50% line and the median line (ML), so the rally towards the median line is natural.
I've said in my previous analysis that a valid breakout above the 150% line and above the R1 (1.2725) will bring a buying opportunity.
- GBP/USD Trading Tips
The breakout above the 1.2813 has confirmed a further increase up to the median line (ML), actually, GBP/USD could be attracted by the confluence area formed at the intersection between the median line (ML) with the warning line (WL1).
If you want to catch a larger upside movement, maybe you should wait for a valid breakout above the confluence area, above the ML, and above the WL1 lines. Still, the valid breakout above the R1 (1.2725) level has signaled a potential rally towards the R2 (1.3049), so GBP/USD could out the near-term obstacles.
I believe that only a false breakout with huge separation above the near-term resistance levels will force the rate to develop a corrective phase.
