Weekly Chart GBP/USD Update: Reversal lower

Choppy trade beneath congestion resistance at 1.3500 has given way to a sharp pullback in heightened volatility,

with the break below 1.3400 adding weight to sentiment and putting focus on congestion around 1.3300.

Daily stochastics and the daily Tension Indicator have turned down, highlighting a deterioration in sentiment and room for further losses into the coming sessions. A close beneath here will open up further congestion within the 1.3200 - 1.3250 range, where mixed weekly charts should prompt fresh consolidation/range extension. Continuation below 1.3200, however, will add weight to sentiment and open up critical support at the 1.3137/40 current year lows of 24 June - 14 October.

Meanwhile, near-term resistance is at congestion around 1.3400 and extends to strong resistance at the 1.3470 Fibonacci retracement and congestion around 1.3500.

This broad 1.3400 - 1.3470/00 range should cap immediate tests higher as mixed weekly charts and deteriorating longer-term readings keep broader sentiment under pressure and prices capped within the multi-month triangle pattern. A break, however, will improve price action and open up a test of the 1.3550 retracement.