GBPUSD - Looking for a downside correction below 1.6117

Upside momentum was posted in GBPUSD yesterday with the pair clearly breaking the weekly trend of lower lows (from 1.6310-1.6176). However, the rally stalled above 1.6102, a 78.6 percent recovery of losses from 1.6176-1.5828. The intraday chart highlights overnight price action as forming a bearish triangle formation (1 hour). Although we need to see a break of the base (1.6085) to confirm the negative momentum, this has resulted in the bias being mildly bearish going into today while below a stop at 1.6117.

A move to 1.6085 and then we would look to move to a stop of 1.6105. Targets will then be: 1.6053, a measured move and yesterday’s Marabuzo level, then 1.6030 and 1.6001.

The risk however would be with buying through a stop of 1.6117, yesterday’s peak.