GBP/USD: bearish breakout exposes critical 1.2760/70 region

Valeria Bednarik FXStreet

GBP/USD Current price: 1.2819

The GBP/USD pair entered a selling spiral after the latest UK poll showed that PM May lost another point in its leadership against her rival party, accumulating a 5-point loss in two weeks. Support for the Conservative party stands now at 43%, while the opposition Labour party is now at 38% from previous 35%. Despite the absence of fundamental news coming from the UK and persistent dollar's weakness, the pair fell down to 1.2835 ahead of US data release, extending its slide further afterwards, down to its lowest in a month, 1.2809.

Hovering below 1.2830 and near the mentioned low, the pair has shed over 100 pips daily basis already, but the bearish potential remains strong, given that in the 4 hours chart, technical indicators maintain their bearish slopes despite being in oversold territory, whilst the price is way below a bearish 20 SMA, and breaking below the 200 EMA for the first time in over a month. Below the mentioned low, the pair has scope to extend its slide down to the 1.2760/70 region, while a weekly close below this last should anticipate a steeper decline for next week.

Support levels: 1.2800 1.2765 1.2730

Resistance levels: 1.2830 1.2870 1.2910

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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