The GBPUSD pair is up for three consecutive days, and it was trading 0.4% higher during the US session on Monday, hovering near 1.36.
That is the crucial resistance of previous lows, and if the Pound closes above it, the medium-term outlook could change back to bullish. Additionally, it often happens that strong supports and resistances are broken to kill stop-losses. When that happens, a reversal typically occurs.
We might see the same in the GBPUSD pair - it fell sharply below the triple bottom pattern at 1.36, destroyed all the stop-losses of long positions. At the same time, bears entered new short positions on the breakdown.
Now, it will most likely rally further to clear all the stop-losses of the freshly entered shorts. The only goal of the market is to incur the maximum pain for both the sellers and buyers, and this is how it can achieve that.
The next target for bulls will be at the 50-day moving average near 1.3770, ensuring most of the shorts are already stopped out.
Alternatively, if bears regain control of the market, the first support is near 1.35 and afterward at the current cycle lows near 1.34.