November 1, 2021

Back Under Brexit Pressure, GBP/USD Performs Gloomy Action

 Looking at the price chart of the GBP/USD pair, the price movement also does not seem to be able to break the SBR (support become resistance) zone of 1.38000 despite being tested many times.

The plunge action also showed that the price has already penetrated the SBR zone of 1.37000 and subsequently recorded the latest low for 2 weeks with a decline of more than 100 pips.

The price movement is seen resuming the decline at the beginning of the European session today (Monday) and has moved below the Moving Average 50 (MA50) barrier level on the 1 -hour time frame for the initial signal of a bearish trend.

Concerns over the post -Brexit continue to rise amid controversy as France has detained as well as issued a summons to UK boats in the past week and continued to put pressure on the Pound.

Meanwhile, the USD regained a strengthening performance at the close of October after receiving support from the publication of positive personal consumer spending price index (PCE) data.

The release of the data is also likely to return investor confidence for the Federal Reserve (Fed) in raising interest rates in the near future than planned.

A significant decline will see the price move back to the RBS zone (resistance become support) 1.36000 or will show a plunge to even lower levels.

The RBS zone is also a resistance level that is often tested at the beginning of October trading before it was successfully broken on October 13 until it continued to reach a 7 -week high.

If the RBS 1.36000 zone is still able to support the surge, the price is likely to re -reach the SBR 1.37000 zone for investors to assess the response to movements in that zone.

If the price movement manages to break the SBR zone of 1.37000 to fly higher, the price is expected to head back to the next SBR zone at 1.38000 and will indirectly give an indication for a trend change.