The market has been moving sideways for a long time. This movement can be described by the bounds of a small green channel. If the price consolidation continues, then during the next trading week the currency pair will continue to approach the area of the support level of 1.271, which is at the intersection of the lower green and yellow bounds.
However, if we see a break of the upper bound of the green channel and the resistance level of 1.297, the bulls will open the way towards the upper wall of the yellow channel and the nearest significant resistance of 1.337. In this case, we can expect a strong bullish trend.
Thus, we will see if the upper green bound can withstand the pressure of the bulls.
Political context: pound sterling is restricted against all major currencies due to the political uncertainties. Markets react to the weekend polls that revealed the Labour Party is gaining popularity and threatens the Conservative majority in the Parliament.
