British Pound Outlook: GBP/USD Poised for More Selling
- GBP/USD trending lower below support
- Sub-12100 could come soon
GBP/USD trending lower below support
The downtrend off the month high looks poised to continue, with potential for a material drop in the days ahead. On the week ending June 19, GBP/USD broke the trend-line from the March low, putting it into a vulnerable position. Last week’s rebound and failure has further added weight to the pair as we head into a new week.
Looking lower, the next level of support arrives at 12160, a small pivot from May, but the bigger level of support doesn’t arrive until the May low at 12075. Further adding pressure on GBP is weakening risk sentiment. Look for this to continue to be the case in the days ahead.
To turn the picture bullish, we would need to see the downward channel from the monthly high snapped and a firm crossing over the 12542 level along with the March trend-line that was broken and retested last week. If this is to develop a good deal of work will need to be done.
The coming week is seen as favoring sellers, with rallies as potential opportunities for would-be shorts to enter or add on to existing positions.
GBP/USD Daily Chart (12160/12075-area as potentially next stop)
GBP/USD 4-hr Chart (trending below support)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.