GBPUSD is trading at 1.3262 right now and price is showing reversal signs. The decline from 1.3830 is most probably over and we should expect price to recover at least part of the decline. Our first bounce target is at 1.3415.
GBPUSD has so far retraced 38% of the entire upward movement from March 2020 lows. This is important Fibonacci support. The Daily RSI has reached oversold levels and is bouncing higher.
Red lines - bearish channel
Price has exited the near term bearish channel and so far provided three bullish divergence signals. Combined with the fact that at 1.3170 we find the major Fibonacci support, I believe we are currently in a reversal phase and I prefer to be bullish as long as price is above 1.3170. I expect over the coming days price to continue higher and reach initially the 1.3415 level which is the 38% Fibonacci retracement of the decline from 1.3830.
