GBPUSD Prepares for a New Phase of Bullish Trend as Retracement Ends

Market Analysis – July 22

GBPUSD is positioning for a renewed bullish continuation as the recent corrective retracement appears to have concluded. Both the price structure and momentum indicators are now aligning in favor of further upward movement.

GBPUSD Long-Term Trend: Bullish
Since January 2025, GBPUSD has maintained a robust bullish trajectory, having reversed from a significant low. The pair has consistently advanced through key resistance levels, most notably breaking through the 1.34300 supply zone and approaching the 1.38000 level—underscoring sustained bullish pressure in the market.

After surpassing 1.34300, the price experienced a brief bearish retracement, pulling back to retest the former supply zone, which now acts as demand. This pullback formed a double bottom reversal pattern, indicating the potential for a continued bullish move. Reinforcing this outlook, the daily Relative Strength Index (RSI) is exhibiting rising momentum, which adds confidence to the bullish sentiment.

GBPUSD Short-Term Trend: Bullish
On the lower time frame, the price has confirmed a bullish structure with the creation of a higher high following the double bottom formation. However, the 4-hour RSI has entered overbought territory, hinting at a potential short-term retracement. A pullback toward the nearby 4-hour order block is likely before the bullish trend fully resumes. This setup presents a favorable opportunity for traders relying on forex signals to anticipate the next upward leg.