The strong fall of last week on the GBP/USD pair is, indeed, unforgettable. After such a decline, the probability of continuing the bearish momentum was very high, however, the fall did not develop this week.
The three-day growth led to the fact that today the pair is trading near the defining resistance zone of the WCZ 1/2 1.3790-1.3773. When testing this zone, the main model for searching will be bearish, since the downward movement remains a medium-term impulse.
The "false breakdown" pattern of yesterday's high will be formed just at the WCZ 1/2 test. If this happens, it is necessary to enter a short position with a stop not exceeding 50 pips. This will allow you to earn at least 150 pips on the fall of the pair. The risk/profit will not exceed the ratio of 1 to 3. The transaction will be profitable.
Working according to this model, we will get a high probability of working out. If a stop loss is received, it will indicate the formation of an upward reversal model, which will become the main one in early September.
Good luck!The material has been provided by InstaForex Company - www.instaforex.com