Technical outlook:
GBPUSD had managed to rally through fresh highs at 1.3624/25 last week, before reversing sharply. The currency pair had produced an Engulfing Bearish candlestick pattern on the daily chart on Friday, indicating a potential reversal. The Cable currency pair open gap down today and has print intraday lows at 1.3187 already. It is seen to be trading around 1.3268 levels at this point in writing and expected to break below 1.3130 mark in the near term (today).
Immediate and strong resistance is marked at 1.3624 levels now, while short term support comes in at 1.3100 levels respectively. A break below 1.3130 would confirm a bearish reversal ahead but a pullback can be expected before resuming lower again. Please note that GBPUSD might be looking to push towards 1.2675 levels in the next few weeks.
Also note that the entire rally from 1.1414 through 1.3624 looks complete, with a major resistance also taken out at 1.3515 levels earlier. Bears might be inclined to drop towards fibonacci 0.618 retracement around 1.2200 levels as marked here.
Trading plan:
Remain short with stop above 1.3650, target @ 1.2675
Good luck!
