After the powerful move to the downside provoked by Janet Yellen’s speech on Friday which continued during the European session on Monday, GBP/USD has been forming a sideways consolidation for the past 36 hours. The zone in which the pair is forming said consolidation is very clear on the four-hour time frame – it is between the support at 1.30587 and the resistance at 1.31196.
The height of the range is 61 pips.
Should there be a breakout below or above either of the levels mentioned above the expected further movement of the pair will be the height of the range, beginning from the breakout level.
My expectation is that the breakout will be to the downside, but we should not forget that surprises are always possible.