Overview:

On February 5, temporary bullish breakout above 1.5220 (previous consolidation range) took place. Shortly after, an ascending bottom was established around 1.5170-1.5200 indicating bullish sentiment on the market.

Projection target for this bullish breakout has already been reached around 1.5550 where the previous daily bottoms were located (daily resistance).

Two weeks ago, the bearish breakdown of the lower limit of the depicted channel occurred enhancing the bearish side of the market and confirming the Flag pattern as bearish.

Significant bearish pressure was applied at the price level of 1.5200 (R2), then 1.4950 (R1 = breached weekly support).

Bearish persistence below 1.4950-1.5000 indicated a further bearish decline. Initial projection target for this bearish breakout was located at 1.4700.

Yesterday, GBP/USD bulls failed to defend the recent bottom at 1.4700. A new low was hit around 1.4630. However, shortly after, evident bullish rejection was expressed around 1.4630.

Trading recommendations:

Wait for a bullish pullback towards 1.4950-1.5000 for a low-risk SELL entry. SL to be set as daily closure above 1.5015.

TP levels should be set at 1.4900, 1.4840 and finally at 1.4700.