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GBPUSD and EURUSD Retain Negative Outlooks Post Brexit Sell Offs

Technical Analysis

A plunge lower by GBPUSD and EURUSD after the “Leave” vote from the Thursday 23rd June Referendum in the UK, has seen a cautious, but negative consolidation theme merge for these spot rates over the past week.

However, the aggressively negative GBP sell off has sent Cable (GBPUSD) to its lowest level seen since 1985 and caused EURUSD to breakdown below key 1.1128 and 1.1000 supports. This leaves a bearish bias for both the GB Pound and the Euro versus the US Dollar into July.

GBPUSD

Another modest roll lower Friday to probe below 1.3274 support after another setback Thursday from ahead of the 1.3550 retracement level (from 1.3534 and 1.3497) to again leaves a downside bias for Monday.

Furthermore, the aggressive plunge lower Friday (through 1.4004 to trigger an intermediate-term bear shift, reinforced through 1.3834 and 1.3504) leaves the July risks still lower.

For Monday:

  • We see a downside bias for 1.3243 and 1.3204; break here aims for the sell off low at 1.3119.
  • But above 1.3340/49 aims for 1.3429 and opens risk up to 1.3497, then 1.3534.

Short/ Intermediate-term Outlook – Downside Risks:

  • We see a negative tone with the bearish threat to 1.3119.
  • Below here targets 1.3045/1.3000, 1.2817, 1.2565, 1.2000 and 1.1880 (risk to 1.1000 and 1.0520?!?!)

What Changes This? Above 1.4635 signals a neutral tone, only shifting positive above 1.5019.

Monthly GBPUSD Chart

GBPUSD

EURUSD

A solid theme to end the week to again push up to probe above the 1.1150/55 resistance area, having defended the 1.1032/23 support area, for a positive tone into Monday.

However, the aggressive plunge lower on Friday 24th June (after the UK Referendum result) leaves the intermediate-term bias lower.

For Monday:

  • We see an upside bias for 1.1170 and 1.1189; break here aims for 1.1231.
  • But below 1.1032/23 opens risk down to 1.0970.

Short/ Intermediate-term Outlook – Downside Risks:

  • We see a negative tone with the bearish threat to 1.0823/21.
  • Below here targets 1.0777/08 and maybe 1.0520.

Daily EURUSD Chart

EURUSD

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