- GBP/USD drops to 1.2683, marking a new four-week low of 1.2656 amidst risk aversion.
- Technical outlook: Bearish momentum as RSI falls below 50; potential support at 1.2643/38, 50-DMA at 1.2611, and 200-DMA at 1.2547.
- Resistance at 1.2700; if breached, expect consolidation in the range of 1.2700-1.2750.
The Pound Sterling dropped sharply below the 1.2700 figure as risk aversion took its toll on most G7 currencies, except for safe-haven peers like the Greenback. Political turmoil in Europe sent the Euro collapsing against the Swiss Franc, while the GBP/USD falls 0.62% and traded at 1.2683 at the time of writing.
GBP/USD Price Analysis: Technical outlook
From a technical standpoint, the GBP/USD has shifted neutral to downward biased, with momentum hinting that sellers are gathering traction. The Relative Strength Index (RSI) has fallen below 50, turning bearish, while price action shows the pair printed a new four-week low of 1.2656, opening the door for additional losses.
If GBP/USD pierces the confluence of the 100-day moving average (DMA) and May 3 swing high turned support at around 1.2643/38, that would accelerate the downtrend, exposing the 50-DMA at 1.2611, ahead of 1.2600. Further losses are seen below the figure, with the 200-DMA at 1.2547 up next.
Conversely, if buyers moved in and reclaim 1.2700, the GBP/USD could consolidate at around 1.2700-1.2750, as stir resistance lies ahead.
GBP/USD Price Action – Daily Chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
GBP/USD hovers around 1.2750 on UK election day
GBP/USD is trading on the front foot near 1.2750 in early European session on Thursday. A broadly softer US Dollar keeps the pair afloat but traders refrain from placing fresh bets on the Pound Sterling, as UK voters head for polls.
EUR/USD holds below 1.0800 ahead of ECB Accounts
EUR/USD keeps its range below 1.0800 in the European morning on Thursday. This upside is attributed to a decline in the US Dollar due to the escalated speculations of a September Fed rate cut. ECB Accounts is next in focus.
Gold looks north amid light trading, focus shifts to US NFP
Gold price is looking to extend the previous upsurge early Thursday, sitting at the highest level in over a week near $2,360. Sustained US Dollar weakness alongside sluggish US Treasury bond yields underpin Gold price amid the July 4 US holiday-thinned market conditions.
Binance coin poised for an 11% crash
Binance Coin breached its ascending trendline support on Wednesday and declines 3% on Thursday. On-chain analysis reveals a long-to-short ratio below one, indicating bearish sentiment and suggesting a potential price downturn for BNB in the days ahead.
Global strategy 3Q 2024
The latest economic and inflation data support a normalisation of monetary policy. The ECB started by cutting interest rates for the first time in June, while the US Fed is still waiting.