GBP/USD eyes first death cross since May 2019

GBP/USD's long-term indicator is about to turn bearish for the first time in 11 months. 

The pair's 50-day average, which topped out in February and began trending south last month, is on track to cross below its 200-day average. That would be the first bearish crossover or death cross since May 2019. 

Seasoned traders would argue that death crosses are big-time lagging indicators and often trap sellers on the wrong side of the market. This time, however, it may invite chart-driven selling, as the 14-day relative strength index is biased bearish. Back in May 2019, it was reporting oversold conditions. 

The macro-environment is also biased bearish, as investors are likely to continue buying US dollars on increasing fears of a prolonged coronavirus-led slowdown in the global economy. 

Pound offered in Asia

The British Pound declined in Asia amid reports that British Prime Minister Boris Johnson is admitted to hospital for tests after showing persistent symptoms of the coronavirus.

The official statement read, "On the advice of his doctor, the Prime Minister has tonight been admitted to hospital for tests. This is a precautionary step, as the Prime Minister continues to have persistent symptoms of coronavirus ten days after testing positive for the virus."

With coronavirus tightening its grip around the Downing Street, the pound could remain on the offer in Europe- more so, as the data released early Monday showed the British consumer confidence dropped to the weakest since February 2009. 

At press time, the spot is trading near 1.2235, having opened the week on a negative note at 1.2214. The pair faced rejection at 1.2264. 

Technical levels