The GBP/USD pair remains range bound above 1.3216 last week and the outlook is unchanged. Initial bias remains neutral this week first. Further decline is expected with resistance at 1.3482 remaining intact. On the downside, a break of 1.3216 will resume the decline from 1.3867 to 1.3008 structural support. However, a decisive breakout of 1.3482 would indicate that the decline from 1.3867 has been completed, shifting the bias back to the upside of the 61.8% retracement level from 1.3867 to 1.3216 at 1.3618.
In the bigger picture, taking into account the bearish divergence situation in both the D and W MACD, the medium term top should be at 1.3867. A strong break of support at 1.3008 would indicate that the drop from 1.3867 is at least correcting the rise from 1.0351 (2022 low) with the risk of a bearish reversal. This would open the door for further decline to the 38.2% retracement level from 1.0351 to 1.3867 at 1.2524. For now, the medium-term outlook will be neutral at best as long as resistance at 1.3867 holds, or until further development.
In the longer term picture, as long as the 1.4248/4480 resistance area holds (38.2% retracement from 2.1161 to 1.0351 at 1.4480), the long term outlook will remain bearish. That is, price movements from 1.0351 are considered a corrective pattern for the downtrend from 2.1161 (2007 high) only. However, a decisive break of 1.4248/4480 would be a strong signal of a long-term bullish reversal.
