TECHNICAL ANALYSIS

GBPUSD cracks below retracement support


Below trendline / 38.2% retracement / Tuesday and Wednesday swing highs

News that the EU / UK would fail to reach a deal today sent the GBPUSD now below the support defined by:

  • 38.2% at 1.3442
  • Swing highs on Tuesday and Wednesday at 1.34408 and
  • An uptrend line at 1.3441

The low reached 1.34242.

Below trendline / 38.2% retracement / Tuesday and Wednesday swing highs

We are seeing a rebound towards the breakout level, but the bias has shifted a bit more downward on news and price action.

Earlier today, the GBPUSD traded at 1.35387 which was the highest level since May 2018 and broke through the 2020 and 2019 swinging highs at 1.34816 and 1.35139 (see yellow zone in the graphic above). The move below this level turned buyers into sellers, which was helped by the Brexit headlines.

Price risk remains high for the weekend as Brexit talks continue with Britain’s Johnson and EU Presidents. Von Der leyen is due to speak tomorrow. Will they be able to steer the conversation towards a deal? Or will the talks fail altogether?

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