The GBP/USD is building a consolidation pattern after a strong bearish impulse. A bearish breakout could indicate a downtrend continuation within wave 5 (purple) towards the Fibonacci targets whereas a bullish breakout could confirm the completion of wave 5 of wave 1 (pink) at the most recent low. A bullish reversal would only become more likely if price is able to break above the previous tops which could indicate the completion of the wave 1 (pink) and the start of the wave 2 (pink).
The GBP/USD could still be in an expanded wave 4 (green) but price should stay below the 50% Fibonacci still respected the Fibonacci levels of wave 4 (green) despite the volatile news events on the GBP. Price made a first attempt to break support but failed to close strongly below 1.35. Price will need to break above the resistance (red) or below the support (green) trend lines before a next impulsive price action can be expected.
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