GBP/USD remains strong in the short term despite the minor retreat. The minor drop was somehow natural after the impressive growth and because the USDX has recovered a little since Friday.
The currency pair is trading below an important dynamic resistance, a valid breakout will validate another rally. GBP/USD is bullish, so you should search for long opportunities, the USD could lose more ground if the USDX drops deeper.
GBP/USD was rejected by the 250% Fibonacci line in the first instance, but now is coming back to take this resistance out and to continue higher. Personally, I believe that we'll have another breakout attempt above the 250% line in the upcoming hours.
The pair has found support right on the Pivot Point (1.3008), so GBP/USD could develop another upside momentum as long as it stays above this level and above the median line (ML).
- GBP/USD Trading Tips
Buy a valid breakout (close above and retest) above the 250% Fibonacci line, or another higher high, a jump above the 1.3170 level. The second warning line (WL2) could be taken into consideration as a target.
Technically, GBP/USD could resume its upwards movement if it's located above the median line (ML) of the major black ascending pitchfork. A potential significant drop will be validated only if the price drops and stabilizes below the median line (ML).
GBP/USD could drop again if it fails to reach the 250% Fibonacci line, this scenario could happen if the US Dollar Index climbs higher.
