Overview:

The GBP/USD pair has been moving downwards respecting the depicted bearish channel since mid-September when the ongoing channel was initiated. Many bearish impulses were previously initiated around 1.6450, 1.6170, and 1.5940 where the upper limit of the channel came to meet the pair.

The price zone of 1.5890-1.5870 constituted a transient daily support that paused the bearish movement for a few days. However, bears quickly managed to push lower.

Bullish fixation above 1.5890-1.5900 was essential to maintain the bullish scenario. However, bears have failed to do so. Instead, the market pushed towards the next support level located around 1.5600 where the lower limit of the ongoing channel is located.

The GBP/USD pair looks quite oversold. Bullish correction should be anticipated as the pair is currently testing a prominent WEEKLY support corresponding to multiple previous tops established back in May and June 2013.

Bullish Four-Hour fixation above price level of 1.5710 ( Last Friday's highest price level ) is mandatory to pause the ongoing bearish momentum confirming the possible multiple-bottom pattern on the 4H chart.

On the other hand, a break below the recent bottom around 1.5590 invalidates this bullish scenario and renders the current movement as a bearish flag pattern with projection target at 1.5410. 

Trading recommendations:

Bullish fixation above the price zone of 1.5670 - 1.5710( Friday's highest price level ) indicates a bullish corrective movement.

If so, the bullish target level would be initially located around 1.5850 and 1.5880. Stop Loss should be set as daily closure below 1.5600.