GBP/USD rose to as high as 1.6276 last week, but faced resistance ahead of 1.6298 high and retreated. Initial bias is neutral this week and some more consolidations could be seen, with risk of deeper pull back. But after all, near term outlook remains bullish as long as 1.5750 support holds and recent rise from 1.5343 is expected to resume sooner or later. Decisive break of 1.6275/98 will target 61.8% projection of 1.4230 to 1.6298 from 1.5343 at 1.6621 next.
In the bigger picture, price actions from 1.3503 (2009 low) are treated as consolidation to long term down trend from 2007 high of 2.1161. Rise from 1.4230 is treated as the third leg of such consolidation and with 1.5343 support intact, such rise could still continue for 1.7043 resistance. But after all, strong resistance should be seen between 1.7043 and 50% retracement of 2.1161 to 1.3503 at 1.7332 to limit upside. On the downside, break of 1.4230 support will be the first signal of down trend resumption and will turn focus to 1.3503 low for confirmation.
In the longer term picture, the corrective nature of the multi-decade advance from 1.0463 (85 low) to 2.1161 as well as the impulsive nature of the fall from there suggests that GBP/USD is now in an early stage of a long term down trend. Another low below 1.3503 is anticipated after rebound from 1.3503 is confirmed to be completed.