GBP/USD Plunged More Than 3.5% Due to The Ongoing Brexit Concerns

During last week the sterling continued to lose ground against the majors due to the ongoing Brexit concerns, more than 1.8% against the buck. The greenback bolstered from Yellen’s speech at the beginning of the week, as she appeared optimistic for the improvement in the labour market and the economy in general but later it slipped from its 14-year high against the G10 basket. Though, it managed to end the week higher against the G10 currencies as the GDP for the third quarter surprised positively. The U.S. economy grew by 3.5% annualized in Q3, the second upward revise for the preliminary figure of 3.2% and 2.9%.

Additionally, since last week the sterling plunged against all the G10 currencies due to the uncertainty that exists over Brexit. The British pound fell especially against the Swedish Krona and dropped more than 3% while the GBP/USD pair created a fresh almost 2-month low.


Sterling continued to trade lower versus the U.S. dollar for the third negative week in a row and plummeted more than 3.5%. The GBP/USD pair recorded a fresh almost 2-month low and challenged the 1.2230 strong support level.

Last week, it was a light week in terms of U.K. data and as we mentioned in a previous analysis, the cable’s weakness can be attributed to ongoing concerns about Brexit. Now, the pair is developing near the 1.2280 price level as it gets stuck below the 1.2310 resistance barrier. During this week, we expect a quiet market due to holidays, so the price will continue developing with some weak momentum. If the pair slips below the 1.2230 support obstacle, it will open the way for the 1.2200 critical level. Otherwise, an upward penetration of the 1.2310 resistance level, will expose the pair towards 1.2390. Technical indicators are following a negative path while RSI is moving slightly above the 30 level with some weak and MACD is holding above from its trigger line.


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