GBP/USD's decline last week suggests that a short term top is at least formed at 1.6300. Initial bias remains on the downside this week ad break of 1.6060 resistance turned support will confirm this bearish case. Also, this will be the first sign that whole rebound from 1.5234 is finished and will bring deeper fall to 38.2% retracement of 1.5234 to 1.6300 at 1.5893 first. On the upside, break of 1.6181 minor resistance is needed to signal completion of fall from 1.6300. Otherwise, near term outlook will stay cautiously bearish even in case of recovery.

In the bigger picture, price actions from 1.3503 (2009 low) are treated as consolidations to long term down trend from 2.1161, no change in this view. Such consolidation could extend further and there is no confirmation of completion yet. We're slightly favoring the case that it's a triangle pattern and thus, even in case of another rise, strong resistance should be seen below 1.6746 to bring reversal. Meanwhile, break of 1.5234 will serve as a signal of down trend resumption for another low below 1.3503.

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 there is confirmed to be completed.