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The GBP/USD pair dropped as much as 1.2105 where it found support. Now, it is moving somehow sideways in the short term. This could represent only a distribution before resuming its downside movement. In the short term, it could come back to test and retest the immediate resistance levels after its massive drop.
Later, the Uk data could bring some action to this market. The Current Account could drop deeper from -7.3B to -39.7B, the final GDP may report a 0.8% growth, the Nationwide HPI could report a 0.5% growth, while the revised Business Investment is expected to register a 0.5% drop. In my opinion, the US data could be decisive today. The Core PCE Price Index, Unemployment Claims, Personal Spending, Personal Income, and Chicago PMI could really shake the markets. Better-than-expected data could boost the USD and could send the GBP/USD pair towards new lows.
GBP/USD Down Channel Violated!
GBP/USD failed to stabilize below the channel's downside line signaling exhausted sellers and a potential rebound. Its failure to make a new lower low announced a potential growth towards 1.2165.
The current throwback could bring new selling opportunities. The bias remains bearish as long as it stays under 1.2165 and below the downtrend line.
A new lower low, dropping and closing below the 1.2105 and under the channel's downside line could activate more declines. This scenario could bring new short opportunities with a potential target at the weekly R3 (1.2020).