GBP/USD rebounded further to as high as 1.4769 last week but failed to sustain above mentioned 38.2% retracement of 1.5521 to 1.4230 at 1.4723. Subsequent sharp fall argues that such recovery is already completed. Initial bias is on the downside this week for 1.4230 low first. Break will confirm down trend resumption for 61.8% projection of 1.5521 to 1.4230 from 1.4769 at 1.3971 next. On the upside, break of 1.4769 resistance is needed to invalidate this bearish view. Otherwise, further decline would remain in favor in case of recovery.
In the bigger picture, our bearish view remains unchanged. Fall from 1.7043 is tentatively treated as resumption of the whole down trend from 2007 high of 2.1161. Such fall should target 61.8% projection of 2.1161 to 1.3503 from 1.7043 at 1.2310 after taking out 1.3503 low. On the upside, break of 1.5521 resistance is needed to be the first signal of bottoming. Otherwise, outlook will remain bearish.
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. Rebound from 1.3503 should have completed and the whole fall from 2.1161 is likely resuming for 61.8% projection of 2.1161 to 1.3503 from 1.7043 at 1.2310 next.