GBP/USD Daily Forecast

Daily Pivots: (S1) 1.6406; (P) 1.6483; (R1) 1.6600;

We continue to stay neutral in GBP/USD with it bounded in established range of 1.6185/6617. The consolidative nature of price actions from 1.6617 argues that more upside would be seen. Break of 1.6617 will suggest rise from 1.5801 is resuming for 61.8% projection of 1.4395 to 1.6661 from 1.5801 at 1.7201. But in such case, upside momentum is expected to diminish as GBP/USD approaches this level and finally bring reversal. On the downside, below 1.6185 will flip intraday bias back to the downside for 1.5801 support instead and will revive the possibility that GBP/USD has already topped out.

In the bigger picture, rise from 1.3654 is treated as the third leg of the correction that started at 1.3503, which correct the larger down trend from 2.1161. Such rally from 1.3654 should be in the last stage after meeting target zone of 1.6428/7332 (38.2% and 50% retracement of 2.1161 to 1.3503). Focus will remain on reversal signal as we'd expect the whole correction from 1.3503 to conclude here. On the downside, firm break of 1.5801 support will now be an important signal that the whole correction has finally completed and will turn focus to next key support of 1.4984 for confirmation.

Based on ActionForex.com Technical Outlook