GBP/USD's pull back from 1.5777 was contained at 1.5484 last week. Subsequent rebound suggests that rise from 1.5268 is ready to resume. Initial bias remains on the upside this week for 1.5777 first. Break will target 61.8% retracement of 1.6300 to 1.5268 at 1.5906 next. On the downside, break of 1.5484 is needed to indicate completion of such rally from 1.5268. Otherwise, we'll stay cautiously bullish even in case of retreat.

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 not supported by a break of 1.5234 support yet. Hence, outlook remains neutral. On the downside, break of 1.5234 will add much credence to the case of long term down trend resumption and should at least target a test on 1.3503/4229 support zone. Though, break of 1.6300 will bring further rally to 1.6476 and above to extend the consolidation pattern.

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.

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