GBP/USD dropped below 1.2800 in yesterday’s session after the EU refused to grant Fisheries rights to the UK in a post-Brexit deal. The pair is currently trading at 1.2888 with immediate support at 1.2855 other supports are at 1.2830 and 1.28000. The intraday resistance is at 1.2920 another resistance is present at 1.2945.

The SMA-21 is currently showing support at 1.2864 and the SMA-50 is indicating a resistance area at 1.3033. The moving averages also indicating a possible bearish crossover on the daily charts. The RSI has moved below the neutral zone and appears to be going down further. On MACD a bearish crossover has already taken place. The current price pattern is bearish and favors intraday sell entries. A reasonable sell entry would be at 1.2920 with a target of 50 to 60 pips. A tight stop-loss for this trade would be just above the 1.2965 resistance area.

An intraday closing below 1.2820 is likely to accelerate the downtrend and the chances of a further drop towards 126.80 would be high. On the upside, only closing above 1.3000 would be supportive of the bulls.

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By LCMS Traders FX Analysis Team

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