The price movement on the chart of the GBP/USD currency pair has declined to its latest 2 -year low following the negative reaction of investors towards the Pound.
This follows a follow -up statement by the Bank of England (BOE) at a policy meeting last week warning of the risk of an economic recession in Britain, after announcing an interest rate hike as expected.
With the expectation that the US dollar will continue to dominate this week, the assessed price is likely to continue the decline even lower.
After the price plunged from a high of 1.26000 last Thursday, the decline that continued on Friday has hit the latest support level at 1.22800.
The permanent price movement signals a bearish trend where the price moves below the Moving Average 50 (MA50) barrier level on the 1 -hour time frame.
The lower decline will be expected beyond 1.22800 to continue to record the latest lows again.
The downside target is expected to be around 1.21000 which is the price support level in May 2020 trading.
But beware if the US dollar moves weaker this week is likely to react negatively to the US inflation data that will be published.
The price could make a rebound with expectations of passing the resistance at 1.24000 and 1.25000 before testing the 1.26000 zone which was the focus during the upside after last week’s FOMC meeting.
For a higher bullish target after the reversal of the bullish trend, the expectation is for the price to head back to the 1.3000 high.
