Cable falls to two-week low as pound comes under light pressure

Technical Analysis

GBP/USD touches a low of 1.2935 on the session


That’s the lowest the pair has traded since 30 April as price looks to drop below the support region of 1.2940-50. The latest on the Brexit front is that there are whispers of Theresa May saying that she will not sign up for a permanent customs union.

This is largely seen as an attempt to cool down the heat she’s facing from her own Tory party and it isn’t really going to contribute much to cross-party talks, which is still headed nowhere at this point in time.

As for cable itself, sellers continue to stay in near-term control and are building on the move lower in overnight trading. A firm hold below the near-term support level of 1.2940-50 will open up the path towards 1.2900-10 next.

Beyond that, further support is only seen closer to the 25 April low @ 1.2866. As for key risk events, we’ll have the UK labour market report due at 0830 GMT but as mentioned before, it isn’t going to be a game changer in the grand scheme of things as Brexit uncertainty continues to stay the course.

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