Black lines- wedge pattern
green line- bearish RSI divergence
In a previous analysis on GBPUSD we warned traders that current market conditions suggest that a pull back is very probable. When price was trading near the upper wedge boundary we said that we prefer to be neutral if not bearish GBPUSD. Today price is under pressure falling from 1.2639 to 1.25. Although price continues making higher highs and higher lows inside the wedge pattern, the bearish RSI divergence suggests that a deeper pull back could be imminent. Key support is found at 1.2485. Bulls do not want to see price break below this level. A break below it will open the way for a bigger decline towards 1.2350.