Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

Free Trading Guides
Please try again

Live Webinar Events


Economic Calendar Events


Notify me about

Live Webinar Events
Economic Calendar Events






More View More
British Pound Slumped Post Brexit Talks, GBP/USD Eyeing Reversal?

British Pound Slumped Post Brexit Talks, GBP/USD Eyeing Reversal?

Daniel Dubrovsky, Contributing Senior Strategist


What's on this page

British Pound, GBP/USD, Dow Jones, Japanese Yen – Asia Pacific Market Open

  • British Pound fell as Brexit talks fell short of expectations
  • GBP/USD broke under support, opening door to reversal
  • Yen may gain if Japanese 1Q GDP data spooks investors

The British Pound declined on Friday as Brexit talks fell short of making meaningful progress. Michel Barnier – the EU’s chief Brexit negotiator – mentioned that he is ‘not optimistic’ about talks. Across the English Channel, the top UK negotiator David Frost said that ‘very little progress’ was made toward the EU pact. With both sides appearing to head for a stalemate, further uncertainty took to its toll on Sterling amid the Covid-19 outbreak.

Forex for Beginners
Forex for Beginners
Recommended by Daniel Dubrovsky
Forex for Beginners
Get My Guide

The S&P 500 and Dow Jones rose 0.25% and 0.39% respectively in a rather quiet session. A couple of developments undercut more robust risk appetite. Fears of US-China trade tensions escalated as the White House moved to cut Huawei off from global chip suppliers. According to a person close to the Chinese government, the nation is ready to take countermeasures. This may include suspending Boeing airplane purchases.

Retail sales in the world’s largest economy contracted -16.4% m/m in April which both missed expectations and was the sharpest drop on record. A final push from equities into Wall Street close trimmed earlier losses. Still, the haven-linked US Dollar outperformed as well as the similarly-behaving Japanese Yen. The growth-linked Australian Dollar depreciated.

Discover your trading personality to help find forms of analyzing financial markets

Monday’s Asia Pacific Trading Session

Top-tier event risk during Monday’s Asia Pacific trading session includes first-quarter Japanese GDP data. If it sours sentiment by further revealing the headwinds global growth is facing amid the coronavirus, the Japanese Yen could appreciate. This is as the Federal Reserve warned on Friday that there could be a ‘major decline in asset prices’ if the pandemic worsens.

British Pound Technical Analysis

The drop in GBP/USD Friday meant that Sterling broke under key support which is a range between 1.2163 – 1.2228. Thus the pair has exited its persistent consolidative mode in play since late March. Yet technical confirmation is lacking at this point, a confirmatory downside close could set the stage for deeper losses. This is as prices could face former lows from 2017 and 2016 between 1.1950 – 1.2018.

Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -1% -11% -4%
Weekly -5% -3% -4%
What does it mean for price action?
Get My Guide

GBP/USD Technical Analysis – Daily Chart

GBP/USD Technical Analysis Daily Chart

Chart Created in TradingView

--- Written by Daniel Dubrovsky, Currency Analyst for

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.