The GBPUSD currency pair has been locked in a persistent downtrend from its peak at 1.2679. Despite a recent bounce from the 1.2307 level, it is likely a temporary consolidation within the broader downward movement.
As the pair continues its descent, traders should be prepared for another potential decline towards the 1.2307 support level. A decisive breakdown below this level could trigger further downside momentum, potentially leading to a move towards the 1.2200 area. Traders who are bearish on GBPUSD will closely monitor price action for confirmation of a breakdown and consider positioning themselves accordingly.
On the upside, the key resistance level to watch is at 1.2545. A break above this level would provide an indication that the downside move has potentially completed at 1.2307, and a bullish reversal may be underway. In such a scenario, the pair could aim for further gains towards the 1.2700 level. Traders should closely monitor the price action around this resistance level for confirmation of a bullish breakout.
It is important to exercise caution when trading within a downtrend, as countertrend bounces can be short-lived. Traders should carefully assess the prevailing market sentiment and employ technical analysis tools to identify potential entry and exit points.