Since September 13, the GBP/USD pair has been demonstrating a successful bullish breakout above the depicted daily downtrend line which came to meet the pair around 1.3025-1.3090.
On September 21, the GBP/USD failed to demonstrate sufficient bullish momentum above 1.3296. The short-term outlook turned to become bearish within the depicted H4 bearish channel to test the backside of the broken uptrend.
Bearish persistence below the price level of 1.2970 (50% Fibo level) enhanced further bearish decline towards 1.2790 where the lower limit of the movement channel and 79.8% Fibonacci Level were located.
On H4 chart, the GBP/USD pair looked oversold around the price levels of 1.2700. BUY entries were suggested around the lower limit of the depicted H4 channel (1.2690).
As for the bullish breakout scenario to remain valid, bullish persistence above 1.2790 (the depicted channel upper limit) and an early breakout above 1.3000 (50% Fibo level) were demonstrated to maintain sufficient bullish momentum towards 1.3130 and 1.3200.
On the other hand, bearish persistence below 1.2970 (50% Fibo level) allows further bearish decline towards 1.2790 and 1.2660.
That's why, price action should be watched around the backside of the price zone of 1.2970-1.3000 for further trading decisions.
The material has been provided by InstaForex Company - www.instaforex.com