GBP/USD rebounds from weekly PP at 1.2910

Morning outlook - GBP/USD rebounds from weekly PP at 1.2910

• The latest developments in the GBP/USD currency pair forced to partially review the situation.
  
  
• On the one hand, the Pound expectedly rose and bounced off from the weekly PP at 1.2910.
  
• On the other hand, the subsequent fall through the 55- and 100-hour SMAs entails that the pair is rather moving in a rectangle or triple bottom formation that in the descending triangle.
  
  
• If the first assumption is true, the Pound has to eventually break through the 1.2846 level to the bottom and continue to move in a downtrend. This scenario seems rational since the 200-hour SMA is located way above the current market price.
  
• But if the second assumption is true, the pair should change the direction and start to move to the north.
  

Trade closed: target reached:

GBP/USD breaks through 1.2846

In accordance with one of the scenarios expressed yesterday, the currency exchange rate made a confident breakout from the rectangle formation and slipped to the bottom.

The likely impulse for such outcome was provided by a combination of the 55- and 100-hour SMAs near the 1.2881 mark.

At the moment, the currency rate has only one barrier on its way, which is set up by the weekly S1 at 1.2799.

In the short run, the pair might a make a rebound.

But, given the general downtrend that started in the beginning of August, the Pound is expected to continue to lose value against the US Dollar.