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A prominent bottom was established around 1.6250. This price level corresponds to previous multiple tops as well as another recent bottom established in December 2013.
A breakthrough above the price zone of 1.6590-1.6660 opened the way directly towards the upper limit of the depicted channel around 1.6820 where the GBP/USD pair topped recently.
As expected, shortly after, the bears retraced towards 1.6590-1.6660. An ascending bottom was established there on February 24.
The bulls are probably targeting at the recent high around 1.6800. The market may offer a SELL entry at retesting.
On the other hand, the pair is moving sideways in a price range which needs an obvious breakout to end the congestion phase taking place now.
The pair is still trapped between 1.6730 (61.8% Fibonacci on the 4H chart) and 1.6590 (lower limit of this congestion zone).
As depicted on the chart, the bulls tried to breakthrough above 61.8% Fibonacci around 1.6730. However, immediate bearish rejection took place to push lower again.
Fixation below the price zone of 1.6705-1.6735 will allow a bearish impulse to take place towards 1.6620 initially.
Price action should be watched at retesting of price zone of 1.6550-1.6470 as a valid BUY entry may be offered with stop loss as 4H closure below 1.6500.
On the other hand, Sellers should be watching the recent top at 1.6820 for a new SELL entry with SL as daily closure above 1.6850.
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