The GBP/USD pair showed a significant bullish reaction towards Support level 1.5265 which turned our short-term view for the pair into bullish since then. The 4H chart also reveals a significant resistance level located around 1.5635 which corresponds to the lower limit of a previous congestion zone which will be the key-level for this week's movement. Yesterday, GBP/USD failed to break the lower limit of the violet channel. Instead, the pair showed significant bullish price action manifested in the bullish hammer 4H candlestick which predicted a bullish move towards 1.5630. GBP/USD seems to be failing to reach this Resistance Level 1.5630. Instead, it demonstrated significant bearish reaction manifested in the bearish engulfing 4H candlestick which predicts a possible breakdown of the Violet channel in order to resume the downtrend initiated long time ago.
The 1H chart reveals the strong bullish reaction towards Price Level 1.5460 which corresponds to the lower limit of the Blue and Yellow channel. However, the pair expressed significant bearish reaction today at testing of the lower limit of the broken Violet channel around 1.5600. The GBP/USD pair is expected to visit the lower limit of the Yellow channel around 1.5480 after managing to breakdown the mid-line of the Yellow channel at 1.5553 which took place short time ago. The lower limit of the Yellow channel at 1.5470-1.5480 constitutes a Strong Support Zone where price action should be watched for a possible Intraday BUY entry.