GBP/USD analysis: no-deal better than a bad deal, Pound to yearly lows

Valeria Bednarik FXStreet

GBP/USD Current price: 1.2942

Chances of a no-deal are now up to 60% according to UK's international trade secretary Liam Fox.
GBP/USD bounced from a fresh yearly low, but remains below the previous one, at around 1.2960.

Chances of a no-deal Brexit sent the GBP/USD pair to 1.2919 its lowest for the year. UK's international trade secretary Liam Fox said that Britain is looking more likely than ever to crash out of the EU without a deal due to the "intransigence of the EU Commission." Furthermore, a May's spokesman said later that PM May still believes that no deal is better than a bad Brexit deal, although a good Brexit deal is in the interest of both parts. Brexit negotiations are set to resume next week. Early Asia, the UK will see the release of the BRC survey on retail sales for July, expected at 1.5% from the previous 1.1%. Later in the day, the Halifax House Price index will be out. The pair bounced from the mentioned low but remains at levels last seen in September 2017, and below the previous yearly low at around 1.2960, now the immediate resistance. In the short-term, the pair is extremely oversold, but there are no signs that a bottom has been reached, as in the 4 hours chart, the pair plunged well below a now bearish 20 SMA, while technical indicators remain in neutral territory, the Momentum aiming modestly higher, following price, but the RSI aiming to resume its decline currently at 22.

Support levels: 1.2920 1.2885 1.2840

Resistance levels: 1.2965 1.3000 1.3045

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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