(GBP/USD). The pair is trading near the 1.3120 level, and several key levels, patterns, and order blocks are coming into play. Understanding these zones can help traders make more informed decisions as we progress into mid-September 2024.
Bearish Order Block (OB) at 1.3265: Major Resistance
The price of GBP/USD is approaching a bearish order block situated at 1.3265, which has historically acted as a key area of resistance. If the price reaches this zone, traders should monitor closely for potential rejections, as it could signal the start of a new downward move.
Fair Value Gap (FVG) and Break of Structure (BOS)
Below the bearish OB, we have a Fair Value Gap (FVG) around the 1.3126 level. This FVG is a crucial area for price interaction, and the recent Break of Structure (BOS) suggests that the market is currently reacting to previous bullish momentum. If the price fails to break higher and sustain above this FVG, it may retest lower levels.
Bullish Order Block (OB) at 1.3050: Key Support
On the downside, a bullish order block lies around the 1.3050 level, which has previously supported the market. If the current price action leads to a downturn, this area could act as a potential bounce zone for bulls to step back in.
Market Structure Shift (MSS) and Continued BOS
Throughout early September, we observed a Market Structure Shift (MSS) followed by multiple Break of Structures (BOS). These shifts reflect the ongoing tug-of-war between buyers and sellers, with the market trying to decide its next major direction. A continuation of the BOS to the upside would confirm a bullish scenario, whereas further failures could trigger a retest of lower levels.
Potential Downside to 1.2750
If the current support levels fail, there’s potential for the pair to move significantly lower, with the next major bullish order block lying near 1.2750. Traders should watch for price reactions around the intermediate OB zones before this level is tested.
Conclusion: Trend Reversal or Continuation?
As the GBP/USD pair consolidates between 1.3050 and 1.3265, traders should watch for a decisive move either above the bearish OB or below the bullish OB. These breakouts could set the tone for the next major directional move in the market.
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