The British pound managed to post a modest recovery after validating the bearish head and shoulders pattern.
But, prices quickly rebounded after hitting the target of 1.2277.
This rebound has led price action to retrace the declines, pushing GBPUSD back to the neckline support level of 1.2423.
With the price level proving hard to break, we are now seeing this previous support level turning into resistance.
As long as prices do not breakout above this level, GBPUSD will be most likely head lower.
The previous lower range of 1.2277 will be the target once again.