The GBPUSD has continued the tumble from Friday when the pair fell the most pips in one day (-256 down) going back to May 6th 2010 (-269 pips). Like the EURUSD, the price took another tumble in the first few hours of trading, rallied back up and has since fallen again in the London session.
The GBPUSD price sliced below 2011 and 2012 lows and trend line support at 1.5245.
Looking at the weekly chart, the price has moved below some technical levels which will be now be eyed as resistance for the pair. In 2011 and 2012, there were a series of lows at the 1.5231-69 area (see chart above). In 2013, the market traded above and below this area as the market consolidated and chopped around before moving higher.
In the London session today, the price has sliced through the 1.52699 level and the 1.52318 as well.. The bottom has tested the 1.5200 level – reaching 1.5202 area a few times now – and rebounded to 1.5236 high – just above that lower 1.5231 level. However, the pressure remains clearly on the sell side. A break of the 1.5200 will have the pair looking toward the 1.5085 level going forward (not likely today). This is the lower trend line on the weekly chart above.
GBPUSD on the 5 minute chart is finding buyers at 1.5200 but not much rebound in the London session.
For today, the sellers will remain in firm control as long as the 1.5231-465 area holds resistance. The 1.5231 is the low from the 2012, the 1.52465 is the 38.2% of the move down today from the London session high (see 5 minute chart) and the 1.5245 level is a broken trend line on the weekly chart (see weekly chart above).
The market had a chance to take the pair higher leading into the London opening, but found sellers. Now with the price moving below the support levels at 1.5231-46, the burden remains on the buyers to prove they can take back control. If they cannot get the price above these levels at the minimum, the sellers will continue on their trek lower for the pair with the Asian session low at 1.51796 followed by the 1.5085 trend line support from the weekly as the next targets.
