A bearish breakout below 1.5550 directly exposed lower targets. Bears have already pushed towards the price levels of 1.5050 and 1.4960, which have not been visited since July 2013.
Around the price levels of 1.5050 and 1.4960 the market has established another consolidation zone, which extended up to the price levels of 1.5280.
Two weeks ago, the ongoing bearish trend was terminated when bullish breakout above 1.5200 took place, as depicted on the chart. Since then, the GBP/USD pair has been trending upwards within the depicted bullish channel.
Estimated projection targets located around 1.5600-1.5640 have not been reached. Instead, bears put significant pressure around 1.5550 resulting in formation of multiple bearish engulfing daily candlesticks without further retesting of 1.5600.
The nearest DEMAND level to meet the pair is located around 1.5200 where the previous tops were located.
Two weeks ago, the GBP/USD pair consolidated above the price zone of 1.5300-1.5360 which failed to provide enough RESISTANCE over the last bullish swing.
For the current bullish breakout to persist, bulls should keep defending the price zone of 1.5170-1.5220 (significant Fibonacci zone) that is being tested today.
On the other hand, the price action should be seen around the price zone of 1.5170-1.5220 (Intraday DEMAND zone) to determine the next destination of the GBP/USD pair.
Bearish breakdown of 1.5170 should not be excluded, especially after the obvious bearish engulfing candlestick that occurred on Monday. If so, a quick bearish decline towards 1.5080 would be expected.
The material has been provided by InstaForex Company - www.instaforex.com
