The pound started the new week very badly and it continues to decline, with the GBPUSD pair briefly dropping below the psychological 1.20 threshold today, reaching fresh 3-year lows.

Traders continue to sell sterling after Prime Minister Boris Johnson said he would trigger a general election in October if lawmakers pass legislation later in the day to force a Brexit delay in the event of a no-deal. 

MPs are planning to put forward legislation forcing a delay until the end of January if Johnson is unable to reach a deal with the EU by mid-October.

Thus, the pound could remain under selling pressure, due to elevated political uncertainty and the looming Brexit deadline. Some analysts are already predicting 1.10 or even parity over the next months, for the GBPUSD pair, that is. 

From the technical analysis perspective, the pair seems heavily oversold, but this fact doesn't need to be enough to stop bears. If the daily candle closes below the 1.20 mark, further selling could occur. 

The short-term support seems to be at today's lows at around 1.1960 and if it doesn't hold, the decline could continue, targeting October 16 lows at 1.19.

On the upside, rallies are expected to be sold, with the first stronger resistance located near 1.2080/1.21. Rising above would most likely hit weaker stop-losses, which could push the pound further higher to 1.2140.

Trading FX/CFDs on margin bears a high level of risk, and may not be suitable for all investors. Before deciding to trade FX/CFDs you should carefully consider your investment objectives, level of experience, and risk appetite. You can sustain significant loss.

Analysis feed

Latest Forex Analysis

Editors’ Picks

EUR/USD: trade war optimism skews the risk to the upside

The EUR/USD pair has rallied to 1.1062 on Friday, its highest since September 20, as risk-on prevailed heading into the weekend. Reports on progress in trade talks between the US and China.


GBP/USD's rally stalls in the open as weekend headlines highlight Brexit deadlock

GBP/USD is a touch softer in the open on Monday, starting off the week in the consolidation of Friday's upside extension to the highest levels since mid-summer. 


USD/JPY consolidating bull rally into 108 handle on US/Sino trade deal optimism

USD/JPY starts out the week flat to Friday's close after markets rallied at the end of the week. Bullish geopolitical undertones in the form of a U/Sino 'phase 1' trade deal help lift USD/JPY onto the 108 handle.


US China trade deal propels US markets and yields higher and leaves dollar mixed

The US and China reached a limited trade deal on Friday a first step on the path to what both sides said could be a more comprehensive pact later in the year. President Trump said the countries reached a “very substantial phase one deal”.

Read more

Gold slumps below $1,480 as risk appetite continues to dominate the market

The bearish pressure surrounding the XAU/USD pair on Friday intensified in the last hour as markets continue to price a possible trade deal between the United States (US) and China.

Gold News

Forex Majors