GBPUSD Experiences Bearish Shift in Market Structure

Market Analysis- May 22

GBPUSD price has struggled to rise to the resistance level of 1.2640. The supporting trendline which aided the ascent has been broken. GBPUSD price appears ready for a free fall!

GBPUSD Key Levels

Supply Levels: 1.2450, 1.2640, 1.2800
Demand Levels: 1.2260, 1.2020, 1.1800

GBPUSD Long-Term Trend: Bearish

GBPUSD Bulls made attempts to rise beyond the 1.2450 resistance level but failed twice in December and January. The strong bullish trend that emerged from the oversold region (as displayed on the Stochastic Oscillator) in November ended abruptly at the test of 1.2450. The sellers guarded the zone and utilized the opportunity to execute short orders.

The Parabolic SAR (Stop and Reverse) indicator guided Bulls in March to break the well-guided resistance zone. The Bulls revealed weakness at the supply level with the formation of the double bottom bearish reversal pattern and small-sized candles but eventually pushed through. 

GBPUSD Short-Term Trend

Buyers are now exhausted as the bullish order block of 1.2450 has failed to hold. The break of the bullish trendline is expected to cause a fall in price to 1.2260.

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