The GBPUSD experienced a violent but incredible depreciation during trading on Tuesday following the recent polls showing almost 52% of people voting to leave the European Union when the likelihood to vote was taken into account. For an extended period, this pair was already under immense pressure and the breach below 1.420 may have opened a path for a further decline towards 1.400. From a technical standpoint, prices are balancing above the daily 20 SMA while the MACD trades deep into the downside. Previous support around 1.420 should become a dynamic resistance which may encourage a further decline to 1.400 and potentially lower. A bullish move back above 1.440 suggests bearish weakness and invalidates this daily bearish outlook on the GBPUSD.
Pound weakness continues to be the main driving force which has provided the foundation for bears to consistently create lower lows and lower highs on the GBPJPY. This pair is extremely bearish on the daily timeframe and the breach below the 160.00 support may have opened the floodgates to a steeper decline towards 155.50 and potentially lower. From a technical standpoint, the candlesticks are trading below the daily 20 SMA while the MACD crosses to the downside. This potentially engulfing formation may have sealed the deal for the GBPJPY to decline for the rest of this trading week and potentially through the months of February. A daily close aback 162.50 invalidates this daily bearish outlook.
This pair has followed a negative trajectory for an extended period with prices declining over 3500 pips from the 2.24 peak in August 2015 and remains firmly bearish on the daily timeframe. There have been consistently lower lows and lower highs while prices have found comfort below the 20 simple moving averages. As long as the previous lower high at 1.9250 defends firmly, bears may send the GBPAUD lower towards 1.8800. A bullish move back above 1.9250 suggests bearish weakness and invalidates this bearish outlook.
As expected, Sterling vulnerability was the main catalyst which sent the GBPCHF back below 1.400 as discussed in Monday’s market report. This pair remains heavily bearish and a daily close under 1.400 may open a path towards 1.380 in the medium term. From a technical standpoint, previous support at 1.400 should transform into a dynamic resistance which may encourage bearish investors to attack the GBPCHF lower towards 1.380. A move back above 1.4100 suggests bearish weakness.
Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.