On March 2, bearish breakdown of the lower limit of the previous daily channel occurred enhancing the bearish side of the market.
Persistence below the zone of 1.4950-1.5000 indicated a further bearish decline towards 1.4700.
Shortly after, the bearish trend was resumed towards the level of 1.4550 where a lower daily bottom was established.
Evident bullish recovery emerged at 1.4560 pushing the GBP/USD pair above the level of 1.4700. Since then, successive higher highs have been established on the H4 chart.
As anticipated, daily closure above 1.5060 (50% Fibonacci level) exposed the next resistance levels at 1.5400 and 1.5450 where extensive bearish pressure was applied.
Persistence below 1.5300 (the lower limit of the H4 channel) enhanced the bearish side of the market towards the levels of 1.5300, 1.5250 and 1.5100.
The price level of 1.5050 remains the most prominent support level to watch for long-term buy entries (corresponds to 50% Fibonacci level and the previous consolidation range's upper limit).
On the other hand, the price zone of 1.5550-1.5580 is now a critical zone to be watched for price action.
Obvious bullish breakout above 1.5550 indicates further bullish movement initially towards 1.5750 (backside of the broken channel) where a valid SELL entry can be taken.
The material has been provided by InstaForex Company – www.instaforex.com