Previously at Price zone (1.6350-1.6410), the current long-term bearish trend was initiated almost two months ago.
Price zone of 1.6100-1.6140 constituted a solid SUPPLY zone. On the other side, prominent bullish DEMAND existed around price zone of 1.5940 - 1.5890.
Hence, the pair was trapped between 1.6100 and 1.5890 for almost 20 days before bearish breakout could take place.
Daily fixation below 1.5870 has put further bearish pressure on the pair to reach 1.5650 where the back side of the broken bearish channel is located.
The previous daily candlesticks represented intraday DEMAND offered around 1.5650 after such a strong bearish momentum. Sideway movement has been taking place for a whole week.
The market is showing indecision between 1.5600 and 1.5760 ( Monday's high ). Alternative bullish and bearish daily candlesticks are being expressed within a 150 pips range.
The GBP/USD pair has a solid Intraday SUPPLY around 1.5830-1.5880 where many prominent lows were located.
4H chart reveals long period of downside movement roughly maintained within the limits of the depicted channel.
Last week, the bears managed to break below the recent low around 1.5790. This exposed potential targets at 1.5700,1.5650 and 1.5580 where the backside of the broken channel as well as previous bottoms are located.
As anticipated, risky traders could have taken a BUY position around 1.5600-1.5650. It achieved some profits then the market returned to retest the same entry levels.
Conservative traders should wait for another pull-back towards 1.5830-1.5860 for a low-risk SELL entry. Stop Loss should be located at 1.5870 ( slightly above entry levels ).
On the other hand, a break below the triple-bottom price zone (1.5600 - 1.5590 ) temporarily ends the indecision state of the market exposing price levels of 1.5500.
The material has been provided by InstaForex Company - www.instaforex.com
