GBPUSD Price Analysis: Bulls are lurking at key support, eyes on a correction

• GBPUSD bulls could be about to move in to pick low-hanging fruit. 
• The sell-off has been sharp but the M-formation is a reversion pattern.

GBPUSD was offered as the US dollar and yields rallied due to the US treasury notes selling today at 4.140% compared to 4.106% in the moments before the auction in the WI market. Since the sale, gains have been wiped clean and Cable remains under pressure. The results so far for the US midterm elections showed little evidence of a "red wave", leaving investors to focus on upcoming inflation data. Technically, there could be a reversion in order, however, as the market calm ahead of the event as the following will illustrate:

GBPUSD H1 chart

The bears have moved in and eye a break of the 1.1290 support line, Monday's lows. A correction in the meanwhile, however, could be in order.

GBPUSD H4 chart

The M-formation is a reversion pattern and the price would be expected to retrace at least to the 38.2% Fibonacci of the bearish impulse.