GBP/USD hammered down to fresh 5-week lows

Haresh Menghani FXStreet

The British Pound selling pressure intensified during early NA session, with the GBP/USD pair breaking below 1.2950-45 support area and drop to hit a fresh monthly low.

Having tested 1.2915, the lowest level since August 16, the pair has managed to bounce-off few pips and is currently trading around 1.2930-40 band. A tepid US Dollar recovery triggered the initial leg of slide earlier on Friday and the sentiment worsened after UK foreign minister Boris Johnson said that the government is looking to trigger Article 50 in early 2017.

From technical perspective, the pair is hovering around a short-term ascending trend-line support extending from July lows through lows touched in mid-August. Hence, a subsequent break below this trend-line support would turn the pair vulnerable to extend its weakening trend further in the near-term.

Technical levels to watch

A fresh bout of selling pressure below session low at 1.2915 is likely to drag the pair towards August lows support near 1.2875-65 region with 1.2900 round figure mark acting as minor intermediate support.

On the upside, previous monthly lows support near 1.2945-50 region now becomes immediate resistance above which the pair could stage a recovery towards 1.2985 horizontal resistance. Any further up-move might now confront fresh supply at 1.3000 psychological mark.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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