Failed to Break Through Last Week's Resistance, GBP/USD Plunged Again 120 Pips!


 The price chart of the GBP/USD currency pair on Tuesday yesterday showed a mixed pattern as it closed the February trading curtain.

At first the price continued the upward pattern like at the beginning of the week with a surge of over 100 pips reaching a height of 1.21400, retesting the resistance of the previous week.

As previously expected, the Pound currency was supported by positive developments regarding the Brexit agreement involving the Northern Ireland protocol.

However, the strengthening momentum of the Pound stalled when the US dollar returned to display its strengthening as the trade headed towards the end of the New York session.

Therefore, the price has plunged from the height of 1.21400 which has been reached up to the level of 1.20200, about 120 pips of decrease was recorded.

The price slowly resumed trading at the opening of the Asian session this Wednesday morning and flattened below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the GBP/USD chart as an early signal of bearish movement.

Further declines will be expected to break through the 1.2000 zone before heading to the price support zone around 1.19000.

It is likely that a further decline could occur towards the end of the week as prices hit recent 8-week lows.

However, it is not impossible for the surge to continue today if the US dollar fails to maintain its dominance over the Pound.

The price could bounce back past the 1.21000 level first before once again testing the 1.21400 resistance that has been holding back the price since the previous week.

Breaking the barrier will push the price towards the 1.22000 level or continue to hunt for the latest high.