GBP/USD showed strong bullish momentum but price is now facing a solid resistance zone via the 38.2% Fibonacci retracement level.
The GBP/USD is likely to make a bearish bounce at the 38.% Fib resistance zone. But the bearish reaction is expected to be mild and not make a new lower low. Instead the current wave outlook suggests a bullish ABC (green) pattern within wave 4 (green) with the main target at the 50% Fibonacci of wave 4 vs 3.
The GBP/USD needs to break below the support trend line (blue) if the price is going to develop a bearish ABC (orange) pattern within wave B (green). The main targets for the bearish ABC zigzag is the 50-61.8% Fibonacci support zone, which could be a bouncing spot for a move up towards 1.2850. An immediate bullish break could indicate a continuation of wave A (green).
The analysis has been done with the CAMMACD.MTF template.
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