GBP/USD Retraces after Sturdy Bearish Breakout below 1.3250

GBP/USD

4 hour

The GBP/USD bearish momentum broke below a key round level at 1.3250 and the support trend line of the descending wedge chart pattern (dotted blue). It seems more likely that price is now building a wave 3 impulse (purple) as long as price stays below the resistance trend lines (orange). A bearish continuation could see price move towards the Fibonacci targets of wave 5 (blue).

1 hour

The GBP/USD ending diagonal pattern is only valid if the GBP/USD retraces back to the 61.8% Fibonacci retracement level of wave 4 (green). A bearish bounce at a shallower Fibonacci levels would indicate that there is no ending diagonal but rather a bearish impulse. In both cases price could continue with the downtrend towards the Fibonacci targets.

Chris Svorcik

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This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Please note that such trading analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.