On H4 chart you can see that the popular cable is moving in a consolidation. Narrowing quotations draw a form of a triangle, in which the lower edge was often and accurately respected. Hence its break may give us some clue as to the further movement of the price.
On daily chart you can see why I would prefer to break the bottom of this formation. First of all, price since October last year moved in a downward channel. Currently GBPUSD reflected from the top edge, where we also have a clear resistance. The triangular formation visible on H4 was began by a bearish engulfing candlestick formation. Strong supply signal and as you can see recently this engulfing formation – several times led to declines. Now, if this formation was to be negated, upper limit of channel should be broken, what would change a bit the layout for a longer term.
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