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GBPUSD Price to Test Strong Support; Brexit Mayhem, Political Meltdown

GBPUSD Price to Test Strong Support; Brexit Mayhem, Political Meltdown

2019-05-08 08:10:00
Nick Cawley, Analyst
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GBPUSD Price and Latest Brexit News:

  • GBPUSD fades into strong support.
  • Brexit deal increasingly unlikely. PM May’s position looking untenable.

Q2 2019 GBP and USD Forecasts andTop Trading Opportunities

GBPUSD Nears a Cluster of Support

After spiking up to a one-month of 1.3180 last Friday, GBPUSD has been fading lower and is now trading either side of 1.3040 as UK politics weigh on the British Pound. The US dollar is trading lower, yet the pair continue to slip as Brexit reasserts itself with talk that the UK will now take part in the European elections, that PM May’s leadership is under serious threat and that a second referendum is being openly discussed. Ongoing cross-party Brexit talks have produced no new ideas or plans, and it may be that the Labour Party now push for a General Election, another negative for Sterling. GBPUSD has traded with a positive Brexit premium built in over the last few weeks but this now seems to be gradually being priced-out.

Sterling (GBP) Price Outlook: Brexit Anger May Dampen Sterling Strength.

GBPUSD nears a cluster of support that needs to hold if the pair are to move higher. The 50-day moving average is situated at 1.3010, ahead of the 200-day ma at 1.2972 and the horizontal trend support around 1.2960. It is likely that the last of these three levels should hold if tested although a break and close below would open Fibonacci retracement at 1.2894 and the recent near three-month low at 1.2866.

DailyFX Economic Calendar

GBPUSD Daily Price Chart (August 2018 – May 8, 2019)

GBPUSD Price to Test Strong Support; Brexit Mayhem, Political Meltdown

Retail traders are 64.5% net-long GBPUSD according to the latest IG Client Sentiment Data. See how recent daily and weekly positional changes affect GBPUSD and currently give us a stronger contrarian bearish bias.

Traders may be interested in two of our trading guides – Traits of Successful Traders and Top Trading Lessons – while technical analysts are likely to be interested in our latest Elliott Wave Guide.

What is your view on GBPUSD – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author at nicholas.cawley@ig.comor via Twitter @nickcawley1.

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

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