From 1.5600 to 1.6060 the GBP/USD pair was considered as bullish as it was moving within the depicted bullish channel which has been broken through during the first week of April. Thus the character of the GBP/USD pair was changed into bearish.
The GBP/USD pair showed the massive bearish reaction after testing the 1.6060 level and reached the point 1.5830, which is a support level on the 4H chart (50% Fibonacci level).
However, the GBP/USD pair showed the massive bearish reaction that was able to break down the lower limit of the depicted channel. We expected bullish strength at 1.5830 to come into the market towards 1.5960 - 1.5990, hence as expected, 1.5830 constituted a solid short-term BUY entry towards 1.5945-1.5970.
Proceeding from the previous price action to the current price zone 1.5830-1.6060 we can see that the GBP/USD pair is probably forming a H&S reversal pattern with neckline at 1.5830 and the right shoulder that is expected to be placed around 1.5970-1.5990 which constituted a valid low/risk SELL entry which was triggered last week with initial profit untill now.
Breakdown of 1.5830 will confirm the reversal pattern allowing the GBP/USD to reach 1.5770 then 1.5650.
Some profits should be taken to avoid possible bullish reversal at the current prices & SL can be lowered to 5905 to offside some risk of the ongoing trade.
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