GBPUSD Experiences Bearish Market Reversal

Market Analysis – June 25

The GBPUSD market direction has shifted from bullish to bearish on the daily chart. This change in market structure emerged after the price encountered a resistance trendline on the 24-hour chart. The bearish reversal was indicated by a divergence seen on the RSI (Relative Strength Index).

Key Levels for GBPUSD

Supply Levels: 1.2700, 1.2900, 1.3100
Demand Levels: 1.2600, 1.2400, 1.2100
Despite the market forming higher highs during the first two weeks of June, the RSI displayed lower highs, signaling underlying weakness. This divergence, coupled with the formation of a double-top pattern, served as a reliable indicator of the bearish price reversal.

The break of the parallel channel on the 24-hour chart confirmed the price reversal. This was further substantiated by the Smoothed Heikin Ashi Candles, which turned red, indicating a price decline. These candles are positioned above the daily candles, reinforcing the downward trend. Additionally, the RSI has dropped below 50, further indicating a bearish trend. Short-Term Trend: Bearish

On the 4-hour chart, the price has retraced to 1.2700, where a bearish order block is identified on the daily chart. The formation of a Change of Character (ChoCh) on the lower time frame is crucial for establishing accurate forex signals. The price is expected to decline towards the next support level at 1.2600.

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