In April, Bearish Persistence below 1.3800 favoured bearish decline towards the 1.3600 levels. Bearish breakout below 1.3600 was needed to enhance further bearish decline.
However, the GBPUSD pair was contained above the demand level of (1.3660) a few times before the upper limit of the depicted broken channel could be retested around 1.4100 and 1.4150 which applied significant bearish pressure on the pair.
Transient consolidation range was taking place between 1.4100 and 1.4240 until bearish breakout occurred few days ago.
However, Failure to maintain bearish pressure below 1.4000 (61.8% Fibonacci Level) has enhanced another bullish movement for retesting of the price level of 1.4240 where Conservative traders expected much selling pressure and valid SELL Entries.
That's why, The current bearish decline should be anticipated towards 1.3880 then 1.3800 where the GBPU/USD pair looked quite oversold.
On the other hand, currently, the price zone of 1.4060-1.4100 stands as a prominent supply zone to be watched for bearish rejection and a valid sell entry upon any upcoming bullish pullback.
The material has been provided by InstaForex Company - www.instaforex.com