GBP/USD unable to regain 1.2200, remains near April’s low at 1.2165

GBP/USD capped below 1.2200, leaves 1.2165 support level exposed.
Concerns about the COVID-19 crisis and the consequences of the Brexit are weighing on the pound.
Breach of 1.2245 level confirms a double top formation and increases bearish pressure on GBP.

Guillermo Alcala FXStreet

The pound has revisited April’s low at 1.2165, where the pair found support to regain some ground during Thursday’s US session but lacking follow-through, GBP/USD has turned around RIGHT above 1.2200 to focus on the mentioned 1.2165 support level.

The sterling remains weighed by Brexit and COVID-19 consequences

The pound is going through a clear downtrend against the US dollar, on track to complete a four-day losing streak in which the pair has depreciated about 1.6%. The concerns about the impact of the COVID-19 crisis in the UK, combined with the looming fears of the Brexit consequences are keeping investors away from the sterling.

Today, the GBP/USD has been also weighed by US dollar strength in a session dominated by risk aversion. Furthermore, US President Trump’s comments increasing tensions with China and his support to a stronger dollar have added bearish pressure on the sterling.

GBP/USD confirms a double top below 1.2245

The Pound confirmed on Wednesday a double top at 1.2643/47 after breaching April 21 low at 1.2250, setting its focus on April’s low at 1.2165. Below here, the pair might aim to 1.2030, the 50% retracement of the March-April rally and March 25 high at 1.1975. On the upside, the pair should return above 1.2250 to ease bearish pressure, and above here, aim towards 1.2340 (May 13 high) and 1.2377 (May 12 high).

Author

Guillermo Alcala

FXStreet

Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.

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