GBPUSD – Gains in the European trading session resulted in GBPUSD trading to the 50% pullback level of 1.5586 (from 1.6341-1.4830). USD buying was posted after the FOMC minutes and Bearish Outside Bars were posted on the intraday charts (6 and 4 hours), often a signal of exhausted bullish momentum and the start of a downward bias. We can also note an ‘Ending Wedge’ formation that is backed up by bearish divergence (the chart makes a higher high while the oscillator makes a lower high), often a signal of exhausted bullish momentum, or at least a correction lower. Although the ‘breakout’ has occurred we have bespoke support at 1.5531 so it would be unwise to sell into this level (poor risk/reward). We look for a mild correction to get short this morning. The profit targets will be: 1.5530, 1.5481 and 1.5426

Resistance levels are: 1.5575, 15600 and 1.5703