GBPUSD Reversal

The GBP/USD pair presents a compelling technical setup on the 4-hour chart, featuring a potential 1.27 AB=CD pattern. This pattern suggests an impending bullish move as price retraces around 127% of the initial leg. Furthermore, there's evidence of RSI divergence, where the price forms higher lows while the RSI indicator forms lower lows, indicating a potential reversal in momentum. Traders may consider a long position with caution, awaiting confirmation through a breakout above the CD leg's high and monitoring RSI for a confirmed reversal. However, risk management is crucial in case the pattern fails to materialize, ensuring protection against potential losses.