GBP/USD's rise from 1.5780 extended further to as high as 1.6499 last week and near term outlook remains bullish for 1.6546 resistance. As discussed before, correction from 1.6746 should have completed with three waves down to 1.5780 already. Break of 1.6546 resistance will affirm this bullish case and should send GBP/USD through 1.6746 resistance next. On the downside, break of 1.6260 support is needed to signal short term topping, or we'll stay bullish even in case of retreat.
In the bigger picture, price actions from 1.3503 (2009 low) are treated as consolidation to long term down trend from 2007 high of 2.1161. Rise from 1.4229 is treated as the third leg of such consolidation. The corrective structure of the fall from 1.6746 to 1.5780 suggests that such rebound is not completed yet. Further rise would be seen through 1.7043 resistance. But we'd expect strong resistance at 50% retracement of 2.1161 to 1.3503 at 1.7332 to limit upside and bring reversal. The next medium term would either be the fourth leg of the consolidation from 1.3503, or resuming long term down trend from 2.1161.
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.