The GBP/USD Prognosis Remains the Same

GBP/USD did not drop nor did it climb much higher and yesterday’s pennant continued forming, with the pair moving to the upside towards 1.27744. The pennant pattern is also still valid.

Additionally, there is a RSI divergence on the 4H time frame between the last two highs and another one on the 1H time frame between the last three highs. If that divergence reaches its limit the pair could reach 1.2500 – 1.2400. Considering that GBP/USD is in a strong resistance zone around 1.2750 on both the daily and weekly time frames I think that such a move to the downside is very much possible and it is a matter of time before it occurs.

I think that the first possible target of the move to the downside would be around 113 pips from the breakout level of the pennant.