GBP/USD: Utter carnage – Cable trading at levels not since since 19680s

GBP/USD

Oh sterling! Pick the bones out of that one. Utter carnage in a major currency such as sterling is extremely rare, but simply reflects what an absolute car crash financial markets have become right now. Breaking below $1.1957 support (effectively the post Brexit low, outside a flash crash of October 2016), Cable is now trading at levels not seen since the 1980s against the dollar. Desperately oversold technically (no massive surprise) but also significantly bearish too. With such enormous volatility, and no serious resistance until $1.1950/$1.2000 the market is open to a prospective retracement. On the plus side, yesterday’s low of $1.1460 survived an initial test overnight and incredibly, hourly indicators are suggesting a potential rebound today. A move above overnight resistance at $1.1665 actually would open the door towards $1.2000 (given there is no resistance of note). The question is though, who would trust a sterling rally right now? A close below $1.1460 and we are in round number territory, at $1.1000.