In June 2015, the pair pushed above the depicted level of 1.5550 trying to reach the zone of 1.5900 where the depicted Head and Shoulders pattern was formed.
In November 2015, a bearish engulfing weekly candlestick closed below the level of 1.5200 (the neckline of the Head and Shoulders pattern). This enhanced the bearish side of the market in the long term.
Extensive bearish pressure has been applied against the demand levels of 1.4620 and 1.4360. Both of them were broken to the downside.
Shortly after the GBP/USD pair moved below 1.4220, evident signs of bullish recovery were expressed around 1.4075. Hence, the previous few weekly candlesticks closed again above 1.4220 and 1.4360 indicating strong bullish demand.
Bullish persistence above 1.4360 was mandatory to maintain enough bullish strength in the market. The first bullish target was seen at 1.4615.
Any signs of a bearish rejection around 1.4615 should be taken into consideration as it corresponds to a broken weekly demand level, which is acting as a strong supply level now.
On the other hand, the zone of 1.4360-1.4220 remains a significant demand zone for the GBP/USD pair.
Recently, the GBP/USD pair looked oversold as it moved further below the prominent demand levels of 1.4620 and 1.4360.
Bullish persistence above 1.4360 was mandatory to maintain enough bullish strength in the market. The first bullish target around 1.4615 was already reached.
On February 4, the market failed to close above 1.4615. Instead of it, an inverted hammer daily candlestick was expressed. Hence, a bearish pullback took place towards 1.4360.
On February 8, the market expressed considerable bullish rejection around 1.4360.
This led to a quick bullish swing towards 1.4570 where recent bearish pressure was applied. Hence, another bearish pullback towards 1.4360 was performed last week.
Traders were advised take a valid bay entry at 1.4360 where the depicted daily uptrend came to meet the GBP/USD pair. S/L should be advanced to 1.4400 to secure some profits, while T/P levels remain located at 1.4500 and 1.4600.
Note that the GBP/USD pair remains trapped between 1.4615 and 1.4360 (the recent daily uptrend). A breakout in either direction should be expected.
On the other hand, conservative traders should watch for significant price reaction either at the supply level of 1.4600 or the demand level of 1.4360.
These levels are important key-levels that determine the next destination for the GBP/USD pair.