- GBP/USD drifted lower for the third consecutive session on Thursday.
- Brexit/COVID-19 jitters continued acting as a headwind for the sterling.
- A modest USD strength further contributed to the intraday selling bias.
- Technical selling below the 1.4100 mark aggravated the bearish slide.
The GBP/USD pair witnessed some heavy selling during the early European session and dived to four-week lows, around the 1.4075-70 region in the last hour.
Following a brief consolidation through the first half of the trading action on Thursday, the pair met with some fresh supply and extended the previous day's fall from the vicinity of the 1.4200 mark. The British pound continues to be weighed down by the EU-UK collision over Norther Ireland protocol and talks that further easing of lockdown measures in the UK may be postponed.
Talks between UK Brexit Minister David Frost and European Commission vice-president Maros Sefcovic to resolve differences over the Brexit deal broke up without a breakthrough on Wednesday. In a further escalation of a dispute over the Northern Ireland protocol, the European Union warned of swift and firm action if the UK fails to implement its post-Brexit obligations.
This comes on the back of speculations that the UK may delay plans to end restrictions fully on June 21 in light of the spread of the so-called Delta variant. The combination of factors continued acting as a headwind for the sterling. This, along with a modest US dollar strength, exerted some downward pressure on the GBP/USD pair and contributed to the ongoing decline.
Meanwhile, the latest leg of a sudden drop over the past hour or so could be attributed to some technical selling below the 1.4100 mark. A subsequent fall below the monthly swing lows, around the 1.4080 region might have already set the stage for additional weakness. That said, investors might refrain from placing fresh bets ahead of the US consumer inflation figures.
Technical levels to watch
|Today last price||1.4084|
|Today Daily Change||-0.0036|
|Today Daily Change %||-0.25|
|Today daily open||1.412|
|Previous Daily High||1.4189|
|Previous Daily Low||1.411|
|Previous Weekly High||1.4249|
|Previous Weekly Low||1.4083|
|Previous Monthly High||1.4234|
|Previous Monthly Low||1.3801|
|Daily Fibonacci 38.2%||1.414|
|Daily Fibonacci 61.8%||1.4159|
|Daily Pivot Point S1||1.409|
|Daily Pivot Point S2||1.4061|
|Daily Pivot Point S3||1.4011|
|Daily Pivot Point R1||1.4169|
|Daily Pivot Point R2||1.4219|
|Daily Pivot Point R3||1.4248|
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