Overview :
The trend of GBP/USD pair movement was controversial as it took place in the downtrend channel. Due to the previous events, the price is still set between the levels of 1.2291 and 1.2153, so it is recommended to be careful while making deals in these levels because the prices of 1.2291 and 1.2153 are representing the resistance and support respectively.
The GBP/USD pair has faced strong resistances at the levels of 1.2291 because support had become resistance. So, the strong resistance has been already formed at the level of 1.2291 and the pair is likely to try to approach it in order to test it again.
The market will indicate a bearish opportunity below the new strong resistance level of 1.2291 (the level of 1.2291 coincides with a ratio of 61.8% Fibonacci). Moreover, the RSI starts signaling a downward trend, as the trend is still showing strength above the moving average (100) and (50).
Thus, the market is indicating a bearish opportunity below 1.2291, for that it will be good to sell the below the are of 1.2291. Therefore, it is necessary to wait till the downtrend channel is passed through. Then the market will probably show the signs of a bearish market.
In other words, sell deals are recommended below the price of 1.2291 with the first target at the level of 1.2153. From this point, the pair is likely to begin an descending movement to the price of 1.2068 with a view to test the daily support at 1.1990.
Forecast :
If the pair fails to pass through the level of 1.2291, the market will indicate a bearish opportunity below the strong resistance level of 1.2291.
In this regard, sell deals are recommended lower than the 1.2291 level with the first target at 1.2153. It is possible that the pair will turn downwards continuing the development of the bearish trend to the levels of 1.2068 and 1.1990.
However, stop loss has always been in consideration thus it will be useful to set it above the last double top at the level of 1.2430 (notice that the major resistance today has set at 1.2430). The stop loss should always be taken into account, for that it will be reasonable to set your stop loss at the level of 1.2430.
