The GBP/USD pair reacted strongly towards 1.6300 – 1.6350 zone confirming the bearish retracement scenario expected in the previous weeks.
The bearish Head and Shoulders reversal pattern on the 4H chart, which was confirmed on Friday, enabled 1.6060 level as a full target for the pattern which got hit on Monday with further decline towards 1.6000.
GBP/USD expressed daily closure below the lower limit of the depicted bullish channel which extended the bearish movement towards 1.5970 which has been providing considerable support for the pair so far.
Support: 1.6020, 1.5970, and 1.5920.
Resistance: 1.6125, 1.6160, 1.6260, and 1.6315.
The current price zone (the lower limit of the depicted 4H channel) is providing support until now and the pair is probably forming a short-term bullish Head & Shoulders pattern targeting 1.6105. However, the pair is showing some bearish dominance today.
A long-term support is seen around the price level of 1.5920 (50% Fibonacci Level). However, the recommended trade is to SELL the pair at retesting of the lower limit of the broken channel around 1.6160 with SL located above 1.6215.