The British Pound has seen a sharp decline this week, primarily driven lower by “Brexit” concerns since the calling of a summer referendum on staying in the EU.
This has seen the key psychological target at 1.4000 violated and puts Cable (GBPUSD) at its lowest point since 2009. The threat remains for further losses into later February and March.
A plunge to another new cycle low again Wednesday, through minor support targets at 1.3955 and 1.3905, to reinforce the breakdown this week through psychological/ option target at 1.4000, and aim lower for late February, into March and also for Thursday.
- We see a downside bias for 1.3876/65; break here aims for 1.3815 and maybe 1.3770.
- But above 1.3960 opens risk up to 1.4034, which we would look to try to cap.
Short/ Intermediate-term Outlook – Downside Risks:
- We see a negative tone with the bearish threat to 1.3656.
- Below here targets 1.3504/00.
What Changes This? Above 1.4409 eases bear risks; through 1.4578 signals a neutral tone, only shifting positive above 1.4668.
Daily GBPUSD Chart
Monthly GBPUSD Chart