GBP/USD is still on an uptrend, despite the sharp selloff that occurred recently. The pair has just bounced off the bottom of the rising channel on the 1-hour time frame as indicating potential rallies.
Stochastic is moving out towards the overbought zone, which means that further rallies might be short-lived, possibly until the recent highs around 1.6600 or until the top of the channel near 1.6700.
Going long at market with a stop below the channel and a target of 1.6700 could make a good return on risk for a short-term trade. Moving the stop to entry once price tests the previous highs can minimize exposure later on.
By Kate Curtis from Trader’s Way