29 July 2019, OctaFX – Sterling continued the free fall that started in April as investors continued to focus on Brexit. In the past few days, the likelihood of the country leaving the EU without a deal has increased substantially. The new cabinet by Boris Johnson is made up of leading pro-Brexit members, who believe that the country will do just fine.
They believe that the UK will continue doing business with the EU using the World Trade Organization (WTO) rules. The EU has said that the deal negotiated by Theresa May was the best and only available option. Meanwhile, the UK released positive economic data. In June, mortgage approvals increased by 66.4k while mortgage lending rose by GBP 3.73 billion.
GBPUSD technical analysis
The GBPUSD pair dropped sharply as investors continued to focus on Brexit. The pair reached a low of 1.2295, which is the lowest level it has been since 2017. On the daily chart below, the pair is below the short, medium, and long-term moving averages as shown below. The price is also along the lower line of the Bollinger Bands while the RSI is slightly above the oversold level of 30. The pair will likely continue moving lower.
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