GBP/USD analysis: Brexit uncertainty keeps hurting Pound
|GBP/USD Current price: 1.2878
- Britain will "pay the price" of a no-deal Brexit, says a government watchdog.
- PM May emerged uncharted from the 1922 Committee, but her situation still weak.
The Pound shed another 100 pips against the greenback down to 1.2866 on the day but settling around 1.2880, a major static support level that was last seen early September. There was no particular catalyst behind the daily slump, but persistent uncertainty about Brexit, as the optimism over a new customs proposal faded as quickly as it came. Concerns rose after a government watchdog said that Britain will "pay the price" of a no-deal Brexit, as new borders control may not be ready in time. Also, concerns that the transition period could be extended for several years, becoming a process subject to annual reviews, weighed on the Pound. During the American afternoon, PM May attended the 1922 Committee, the group of Conservatives in the House of Commons, with fears ahead of the event about her decisions being put under scrutiny, but she emerged unscratched, having no effects on Sterling.
Intraday technical readings support further slides ahead, as, in the 4 hours chart, the pair has extended its decline below its 200 EMA and 20 SMA, while technical indicators maintain their strong downward slopes within negative levels ad at fresh October lows. The pair has its next relevant support at 1.2785, September monthly low, a probable bearish target in the case the decline continues sub-1.2855, September 3 low. In the unlikely case of an agreement about the Irish border issue, the pair could reverse course and reclaim the 1.3000 level.
Support levels: 1.2855 1.2810 1.2785
Resistance levels: 1.2925 1.2960 1.3000
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