GBP/USD dropped further to as low as 1.5636 last week and met mentioned target of 61.8% retracement of 1.5234 to 1.6300 at 1.5641. Initial bias remains on the downside this week and sustained trading below 1.5641 will pave the way to retest 1.5234 low. On the upside, above 1.5726 minor resistance will indicate short term bottoming. In such case, stronger rebound could be seen back to 1.5847 resistance and above before staging another decline.

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 be in form of a triangle that's completed at 1.6300 but this is far from being certain. We'll stay neutral until a break of 1.5234 support, which indicates down trend resumption. Before that, more choppy range trading could be seen between 1.5234/6746.

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.