FX.co ★ Technical Analysis of GBP/USD for October 6, 2022

Technical Market Outlook:

The GBP/USD pair has bounced over 11.11% from the lowest level since 1985 located at 1.0352 and is currently extending the rally towards the Fibonacci projection level for wave 5 seen at 1.1560. The last local high was made at the level of 1.1494, so there is still 66 pips left for the projected target level. Despite the recent strong bounce, only a clear and sustained breakout above the level of 1.1410 would change the outlook to bullish. On the other hand, the next target for bears is located at the parity level of 1.0000, so please keep an eye on this level. The intraday technical support is seen at the level of 1.1210. The momentum remains strong and positive, but the market coming off the extremely overbought conditions on the H4 time frame chart.

Weekly Pivot Points:

WR3 - 1.15812

WR2 - 1.13861

WR1 - 1.12966

Weekly Pivot - 1.1191

WS1 - 1.11015

WS2 - 1.09959

WS3 - 1.08008

Trading Outlook:

The bears are still in charge of Cable market and the next target for them is the parity level. The level of 1.0351 has not been seen since 1985, so the down trend is strong, however, the market is extremely oversold on longer time frames already. On the other hand, in order to terminate the down trend, bulls need to break above the level of 1.2275 (swing high from August 10th).