🔍 Detailed Explanation of Analysis
GBPUSD has been moving inside a well-defined ascending channel after bottoming near 1.0356 in 2022. The structure since then appears to be forming an Elliott Wave impulsive cycle, suggesting the market may have completed a corrective phase and is preparing for a larger bullish trend continuation.
The pattern from 1.0356 shows:
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Wave (1) from 1.0356 to 1.3140
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Wave (2) correction back to 1.1800 range
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Wave (3) in progress toward significantly higher levels
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The recent sideways movement looks like a minor wave (4) correction within the larger wave (3)
The corrective A-B-C shown near the recent high indicates a completed correction rather than trend reversal.
📍 Primary Bullish Scenario
The bullish structure remains valid as long as price stays above 1.2770 support.
Why bullish?
🔹 Price respecting long-term rising trendline
🔹 Completed corrective A-B-C structure
🔹 RSI rebounding from support zone showing momentum returning
🔹 Price forming higher highs & higher lows since 2022 bottom
Upside Target Zones
| Target Zone | Expected Wave Reason |
|---|---|
| 1.3830 | Key breakout point / neckline |
| 1.4289 – 1.4577 | Wave (3) Fibonacci extension area |
| 1.5955 – 1.6650 | Major resistance for wave (4) |
| 1.7019 – 1.7655 | Wave (5) completion zone |
| Maximum projection: 1.8600 | Super bullish extension scenario |
A weekly close above 1.3830 will confirm strong upside acceleration and open the door toward wave 3 expansion.
📉 Alternate Bearish Scenario
If GBPUSD fails to hold above 1.2770, correction could extend into deeper levels.
Downside Levels
| Level | Purpose |
|---|---|
| 1.2099 | Strong historical support |
| 1.0356 | Worst-case scenario – retest of wave II |
Bearish invalidation for bullish outlook
❌ Weekly close below 1.2770 will negate bullish setup and confirm extended Wave (2) correction.
📊 RSI Technical View
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RSI has bounced from near the 40 level, a typical wave 4 low zone
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No bearish divergence yet on weekly structure
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Suggests correction finishing and trend resuming soon
🎯 Summary
📌 Primary Trend: Bullish continuation above 1.2770
📌 Near-term target: Breakout above 1.3830 will signal strong upside
📌 Wave (3) under development aiming toward 1.4577 → 1.5955
📌 Alternative bearish scenario only if 1.2770 fails
⚠ Disclaimer
This is a technical analysis study for educational purposes only. Not trading or investment advice. Always manage risk.
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