GBPUSD bearish pattern forming

The British pound has recovered towards the 1.2300 level against the US dollar after traders bought the pair from the 1.2200 level over positive Brexit headlines. The recent decline has helped the GBPUSD pair create an extremely large head and shoulders pattern across the lower time frames. Overall, the latest bounce higher has the potential to form a right-hand shoulder to complete the pattern, with the initial short-term bullish target likely to be around the 1.2370 area.

• The GBPUSD pair is bearish while trading below the 1.2300 level, key support is found at the 1.2200 and 1.2210 levels.
• If the GBPUSD pair trades above the 1.2300 level, key resistance is found at the 1.2350 and 1.2375 levels.