GBP/USD Daily Chart Analysis – Rectangle Pattern Breakout & Bullish Continuation Potential
🔶 Chart Overview:
The GBP/USD daily chart shows a well-structured rectangle consolidation pattern that has been in formation since late 2023. The price has been trading between clearly defined horizontal support (~1.2273) and resistance (~1.3652–1.38) levels for several months. This type of price action typically reflects a market in accumulation or distribution, waiting for a breakout.
🟦 Rectangle Pattern Formation
The rectangle range is highlighted with an orange shaded zone.
Support Zone (~1.2273): Tested multiple times with strong buying reactions.
Resistance Zone (~1.3652–1.38): Also tested several times but failed to break until recently.
The structure indicates strong institutional interest at both extremes, validating the pattern.
🟢 Recent Price Action & Breakout Setup
The price recently rallied back to resistance after bouncing from the lower boundary of the rectangle in early 2025.
The last touch at the resistance formed a minor rejection, hinting at a potential pullback or retest before a confirmed breakout.
A bullish breakout scenario is forming, contingent on:
A retest of the previous resistance turned support (~1.32–1.33 zone)
A bullish candlestick confirmation (e.g., pin bar, engulfing, or bullish inside bar)
📈 Trading Plan – Long Setup
✅ Entry Strategy:
Wait for a pullback toward the previous resistance zone (now support) at ~1.32–1.33.
Look for bullish confirmation patterns on the daily or 4H chart before entering long.
🎯 Target Zones:
TP1 – 1.3652: Previous high / top of the rectangle (range resistance).
TP2 – 1.4261: Projected target based on the height of the rectangle added to the breakout level (measured move technique).
🛑 Stop-Loss (SL):
Place below the rectangle support (~1.2273) to give the trade room and invalidate the setup in case of a breakdown.
📌 Trade Rationale:
Rectangle patterns often lead to strong breakouts after prolonged consolidation.
The pair is currently attempting to break out to the upside, indicating bullish momentum.
The market structure supports the idea of buying the dip on the retest of the breakout zone.
📉 Risk Management & Final Notes:
Risk no more than 1–2% of your capital on the setup.
Ensure confirmation before entry to avoid a false breakout scenario.
If the price fails to hold above the 1.32 zone and breaks below 1.30, reconsider the bullish bias.
🔶 Chart Overview:
The GBP/USD daily chart shows a well-structured rectangle consolidation pattern that has been in formation since late 2023. The price has been trading between clearly defined horizontal support (~1.2273) and resistance (~1.3652–1.38) levels for several months. This type of price action typically reflects a market in accumulation or distribution, waiting for a breakout.
🟦 Rectangle Pattern Formation
The rectangle range is highlighted with an orange shaded zone.
Support Zone (~1.2273): Tested multiple times with strong buying reactions.
Resistance Zone (~1.3652–1.38): Also tested several times but failed to break until recently.
The structure indicates strong institutional interest at both extremes, validating the pattern.
🟢 Recent Price Action & Breakout Setup
The price recently rallied back to resistance after bouncing from the lower boundary of the rectangle in early 2025.
The last touch at the resistance formed a minor rejection, hinting at a potential pullback or retest before a confirmed breakout.
A bullish breakout scenario is forming, contingent on:
A retest of the previous resistance turned support (~1.32–1.33 zone)
A bullish candlestick confirmation (e.g., pin bar, engulfing, or bullish inside bar)
📈 Trading Plan – Long Setup
✅ Entry Strategy:
Wait for a pullback toward the previous resistance zone (now support) at ~1.32–1.33.
Look for bullish confirmation patterns on the daily or 4H chart before entering long.
🎯 Target Zones:
TP1 – 1.3652: Previous high / top of the rectangle (range resistance).
TP2 – 1.4261: Projected target based on the height of the rectangle added to the breakout level (measured move technique).
🛑 Stop-Loss (SL):
Place below the rectangle support (~1.2273) to give the trade room and invalidate the setup in case of a breakdown.
📌 Trade Rationale:
Rectangle patterns often lead to strong breakouts after prolonged consolidation.
The pair is currently attempting to break out to the upside, indicating bullish momentum.
The market structure supports the idea of buying the dip on the retest of the breakout zone.
📉 Risk Management & Final Notes:
Risk no more than 1–2% of your capital on the setup.
Ensure confirmation before entry to avoid a false breakout scenario.
If the price fails to hold above the 1.32 zone and breaks below 1.30, reconsider the bullish bias.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.