- GBP/USD is making fresh lows on the back of continued negative outlooks for the UK economy due to Brexit.
- GBP/USD is making its way lower within the bearish channel and is well on its way to the 100% retracement of the mid-August lows.
- GBP/USD is currently trading at 1.2700 having made a low of 1.2697 from a high of 1.2813.
GBP/USD has been on a one-way street since 11th Oct highs at 1.3258 and Brexit is a major problem for the bulls, especially given the implications that this may have on the BoE, figuring that the uncertainty will be a risk to growth. We have already seen a stagnant August monthly GDP and a declining Sep retail sales as evidence of this weaker momentum, and analysts at TD Securities noted that a recent survey data from the Agents' Survey was showing diminished investment intentions.
"We expect a 9-0 vote for no change, as the BoE sits on the sidelines until Brexit clarity emerges," analysts at TDS argued.
Countdown to no deal Brexit, less than 4 weeks away
We need to see a deal agreed in parliament if sterling is going to turn around and at this juncture, it seems a tough ask. With just over 4 months to go until the United Kingdom is due to leave the European Union, negotiations are at what Prime Minister Theresa May has called an impasse. Even if May can clinch a deal with the EU, her divided Conservative Party could mean that it doesn't pass through with a parliamentary approval and that means the UK will either leave the EU without a deal, and there would probably be a national election or even another referendum.
GBP/USD levels
Cable is en route to 1.2662 as the Aug low level. 1.2589 as being the June 2017 low. 1.1985 is the H&S objective below there. Bulls need to get back to 1.2905 where the 23.5% retracement Fib of the channel is located.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD risks a deeper drop in the short term
AUD/USD rapidly left behind Wednesday’s decent advance and resumed its downward trend on the back of the intense buying pressure in the greenback, while mixed results from the domestic labour market report failed to lend support to AUD.
EUR/USD leaves the door open to a decline to 1.0600
A decent comeback in the Greenback lured sellers back into the market, motivating EUR/USD to give away the earlier advance to weekly tops around 1.0690 and shift its attention to a potential revisit of the 1.0600 neighbourhood instead.
Gold is closely monitoring geopolitics
Gold trades in positive territory above $2,380 on Thursday. Although the benchmark 10-year US Treasury bond yield holds steady following upbeat US data, XAU/USD continues to stretch higher on growing fears over a deepening conflict in the Middle East.
Bitcoin price shows strength as IMF attests to spread and intensity of BTC transactions ahead of halving
Bitcoin (BTC) price is borderline strong and weak with the brunt of the weakness being felt by altcoins. Regarding strength, it continues to close above the $60,000 threshold for seven weeks in a row.
Is the Biden administration trying to destroy the Dollar?
Confidence in Western financial markets has already been shaken enough by the 20% devaluation of the dollar over the last few years. But now the European Commission wants to hand Ukraine $300 billion seized from Russia.