All major currencies were correcting to the downside as people were thinking that higher inflation in the U.S. will push the Fed to higher interest rates. However, GBP/USD is showing a start of a new bullish cycle for major currencies which indicates the probability of USD pairs to start their bearish cycles soon.
As you can see, GBP/USD went 4 waves up. The price is currently trading inside a descending channel or a bullish flag which are both considered continuation patterns for more upside. Additionally, we can spot a falling wedge formation inside the bigger descending which indicates an amazing entry point with a very tight stop-loss for a very rewarding target.
Our targets for this trade will be 1.3945, 1.3980, and the 70.2% Fibonacci Extension level at 1.4079. Good luck!
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