Last night GBPUSD was trading around 1.35 right below the bearish channel resistance. We warned traders that the most likely outcome would be for price to get rejected as the downtrend seemed unfinished. GBPUSD got soon after rejected and reached our target of 1.34 where we find the 61.8% Fibonacci retracement.

GBPUSD remains in a bearish trend. Price is making new lower lows and has reached key Fibonacci support levels. The RSI has provided us with our first bullish divergence in the 4 hour chart. This is not a reversal signal, but only a first warning. We usually see short-term trend reverse after two bullish divergence signals. Current market conditions justify price to bounce higher but we are not sure yet that the downtrend is complete.