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  • Cable breaks through the 200 period Simple Moving Average on the daily chart.
  • The pair is trading 0.72% lower on the session as risk-off sentiment sets in.

GBP/USD daily chart

GBP/USD continues to be one of the most risk-sensitive pairs along with NZD and AUD. Wednesday has been a tough session for any asset that has a correlation with stocks as a rush for the new safe haven of choice (dollar) ensued. 

The chart below is highlighting a pretty bearish picture. The blue trendline has been broken and successfully retested and now there has been a subsequent move lower. This lead to the 200 Simple Moving Average being broken to the downside too. There is now the small matter of the wave low at 1.2336 in the way of the downtrend continuing. 

If the aforementioned support zone does break then the black support line at 1.2087 is next up. Looking at the indicators, the trendline on the Relative Strength Index chart has now been broken to the downside. The MACD histogram is now in the red but the signal lines are lagging behind when it comes to crossing over the mid-line. 

If there is to be a relief rally then look out for resistance at the trendline again but also the psychological 1.25 area could be used. If the price does break beyond that then there could be another push to the wave high of 1.2813 but that seems unlikely at this stage.

GBP/USD bearish technical chart

Additional levels