GBP/USD Daily Chart

Technical Outlook: GBP/USD has continued to trade within the confines of an ascending pitchfork formation extending off the yearly low with price rebounding off slope support last month. The subsequent pullback off the monthly open highs rebounded off near-term support at the 38.2% retracement of the August advance at 1.3320 with sterling topping the performance charts today vs the USD.

The outlook remains constructive while above confluence support at 1.3226 with a breach above 1.3543 needed to mark continuation of the broader uptrend. A breakout eyes subsequent resistance objectives at the yearly high close at 1.3589 and the 2017 high / Brexit gap at 1.3658/75.

GBP/USD 240min Chart

Notes: A closer look at price action highlights a near-term descending channel formation with a prefect rebound off the lower parallel last night shifting the focus back towards the weekly open at 1.3436– a breach above this level clears the way for an advance targeting the high-day close at 1.3495 and the 1.618% extension at 1.3543.

Bottom line: I’ll favor buying pullbacks in price while above 1.3320 targeting a breakout of this near-term formation. A break lower would leave prices vulnerable for a drop into 1.3283 & our broader bullish invalidation at 1.3226. Keep in mind that U.S. November Non-Farm Payrolls (NFP) are on tap tomorrow with the release likely to fuel increased volatility in the dollar crosses.