Brexit Outcomes: GBP/USD Continues to Head Lower
Over the last few months, the British Pound has been one of the most closely watched currencies in the forex markets, and this has started to create technical scenarios that are likely to bring about some favorable outcomes for forex traders. Most of this attention is coming as a result of the Brexit vote, as this is injecting a new wave of volatility in the markets.
With this in mind, forex traders should outline some of the most critical support and resistance levels that are likely to indicate trends reversals over the next few weeks. In the following chart, we can identify some of these levels in conjunction in the US Dollar. These are likely to hold the interest of forex traders over the next quarter.
Forex Chart View: GBP/USD
Critical Resistance 1: 1.36149
Critical Resistance 2: 1.34714
Critical Support 1: 1.32488
Critical Support 1: 1.31146
Trading Stance: Strongly Bearish
Figure: GBPUSD 15-minute time frame
Keeping the current Brexit news in mind the GBPUSD forex trading pair has been showing extreme volatility in the market. The major key support and resistance level has been totally ignored during the last previous 4 to 5 major trading session. However, the pair has formed decent support and resistance level in the 15-minute time frame.
Currently, the price is trading between the key support at 1.32488 and the resistance level at 1.34714. We will stand aside until the pair reaches the initial critical resistance level 1.34714 .We will enter short in the GBPUSD pair once strong bearish price action signal present itself near the resistance level. Due to the recent high volatile movement of the pair it’s imperative that every trader wait patiently for a valid bearish candlestick confirmation pattern since lots of fake outs might be present near the support and resistance level.
The first downside target of the pair would be the nearest support level 1.32488. A clear decisive break of the initial support level will bring further downside move towards the key support level 1.31146.On the contrary, if the pair manages to break the first resistance level 1.34714, we will likely see a ranging market which will ultimately target the major key resistance level situated at the 1.36149 price level.