GBP/USD is showing early signs of basing on the approach to the old swing high at 1.6063 as the pullback from 1.6302 stalls.

While we could see further choppy activity over the short-term the overall tone remains positive and we look for 1.6063 to more or less contain current weakness prior to basing for an extension of the 1.5235 advance.

Re-capture of 1.6199 would suggest completion of the correction, setting the stage for an attack on 1.6302 then 1.6500/1.6618 (psychological/August reaction high) as the bull run extends.

Settlement back below 1.6063 from here would suggest stalling upside momentum, while loss of 1.5805 would threaten key support at 1.5603 (12th March low) in a much deeper retracement of the 1.5235 advance.

Daily Technical Report