GBP/USD formed a short term top at 1.6165 last week and turned sideway. Initial bias is neutral this week and some more consolidation could be seen. But in case of another fall, downside is expected to be contained by 1.5631/5851 support zone and bring another rise. Above 1.6165 should extend the rebound form 1.5271 towards 1.6618 resistance next. Nevertheless, break of 1.5631 will indicate that rebound from 1.5271 has finished and should bring retest of this low.
In the bigger picture, price actions from 1.3503 are treated as consolidations to long term down trend from 2.1161. Such consolidation should be in form of triangle and current development suggests that rise from 1.5271 is the fifth leg, the final leg of such pattern. Hence, while current rise from 1.5271 might extend higher, upside should be limited below 1.6746 resistance to conclude the consolidation finally. On the downside, break of 1.5271 support will indicate that the down trend from 2.1161 is finally resuming for a new low below 1.3503. Nevertheless, break of 1.6746 will invalidate this view and would likely bring stronger rally to 1.7043 resistance and above.
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 consolidation from 1.3503 is confirmed to be completed.