Sterling is back under heavy selling pressure today, as Reuters reported the European Commission President Ursula von der Leyen told the 27 EU leaders that the probability of a no-deal Brexit is higher than of a deal. UK Prime Minister Boris Johnson also said openly yesterday that there is a “strong possibility” of a no-deal.
The Pound is breaking some near term technical levels everywhere, including 1.3223 support in GBP/USD, 137.90 support in GBP/JPY and 0.9142 resistance in EUR/GBP. GBP/CHF also drops through 1.1797 support decisively today, confirm that the rebound from 1.1598 has completed at 1.2003. Further fall should now be seen as long as 1.1977 resistance holds, towards 1.1598 support.
For the moment, we’re seeing price actions from 1.2259 as a sideway pattern. Thus, strong support could be seen around 1.1598 to bring rebound. However, it should be noted that GBP/CHF has been clearly capped by 55 week EMA, maintaining medium term bearishness. Hence, sustained break of 1.1598 would raise the chance that it’s actually resuming long term down trend through 1.1102 low.
