Concerns about Brexit hurting the pound in trading today
Concerns about Brexit talks with the EU have been pressuring the GBP in trading today. The EURGBP is breaking higher and the GBPUSD is moving lower. The pair just reached a new session low.
Technically, the price action has moved below the 38.2% retracement of the move up from the March low to the April high. That level comes in at 1.21737. Yesterday the price moved below that level to 1.2165, but the selling momentum could not be sustained and the price rebounded higher into the close.
Today’s move is showing more momentum through the 38.2% retracement level. Bearish
The pair is now looking to test swing low levels at 1.2127. The swing low from March 27 came in at that level. The April low was at 1.2161. A swing high from March 18 reach 1.21287.
Move below the 1.2127 level and it opens the door toward the 50% retracement of the same move higher on the daily chart. That level comes in at 1.20276 (the price is moving below the 1.2127 level as I type. The low just reached 1.21184).
Drilling to the hourly chart, a lower trendline cuts across at 1.2113. That trendline did stall the fall yesterday (red circle 4 in the chart below). Will it do the same today?
Overall the trend is to the downside for the pair, but a support level is being approached. Being Friday, it may attract some profit-taking potential (with stops on a break below).