The British pound has started to give back recent gains against the US dollar following a strong technical rejection from the 1.2150 level.
16 August 2019, OctaFX – Sterling declined after Brexit discussions continued. Yesterday, Labour Party leader, Jeremy Corbyn appealed to other UK parties to form a coalition with the goal of stopping Boris Johnson’s no-deal Brexit.
In a letter to rival parties, he asked the opposition members and some conservatives to support him in a goal to oust Johnson. As a result, he would become the caretaker Prime Minister. This idea was rejected by most of the people he wrote to. The chart below – from Bloomberg – shows the potential scenarios on Brexit going forward.
GBPUSD technical analysis
Yesterday, the GBPUSD pair declined sharply from a high of 1.2150 and reached a low of 1.2073. In the Asian session, the pair moved up slightly and is currently trading at 1.2087. On the hourly chart, the price is slightly above the 14-day and 28-day moving averages. The RSI has continued the downward trend from a high of 80 to the current 50. The pair will likely continue moving lower, to test the important support of 1.2050.
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