GBP/USD had a strong selloff towards the end of the previous week when the U.S. 

Federal Reserve talked about their concrete plans to exit from their ongoing open-ended asset purchase program. However, the pair has found support at the bottom of the rising channel on the 4-hour time frame.

This channel support could be a key area for the week, as it is in line with the 1.5350 minor psychological support level. A breakdown from this area would confirm the start of a downtrend for GBP/USD.

On the other hand, a bounce from this area, which could be triggered by a strong UK claimant count change release or upbeat remarks from BOE Governor King midweek, could push GBP/USD back to the top of the channel around 1.5600.

By Kate Curtis from Trader’s Way