Overview:

On July 15, extensive bearish impulse was initiated. Since then, the GBP/USD pair has been downtrending limited by the depicted downtrend line.

Two bearish impulses were initiated around 1.7180 and 1.6630 corresponding to the downtrend line.

The price level of 1.6140 constituted a prominent weekly support to meet the pair. Bullish rejection was witnessed in the recent daily candlesticks. This led to a previous bullish weekly closure ( above the weekly support level around 1.6250 ).

Retracement towards the price zone of 1.6350-1.6400 took place as expected where a new bearish impulse is expected to be applied.

This price zone corresponds to the upper limit of the depicted channels as well as Fibonacci level of the recent bearish impulse between 1.7180 and 1.6060.

Trading recommendations:

Based on the previous data, the market offered a valid SELL opportunity around 1.6460 during last week's consolidations.

This short position remains valid as long as the bears keep defending price zone of 1.6310-1.6400 ( 23.6% Fibonacci level and previous top).

Bearish targets are located around 1.6160 and 1.6080.