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The British pound continues to hover around the 1.2800 level against the US dollar as heavy selling pressure remains on sterling. The GBPUSD is strongly bearish while trading below the 1.2866 level, the daily MACD indicator is also now trending lower. A clear breach of the 1.2800 support level is likely to expose the GBPUSD pair to technical selling towards the August monthly trading low, at 1.2785.

The GBPUSD pair is strongly bearish while trading below the 1.2800 level, key support remains at the 1.2785 and 1.2700 levels.

If the GBPUSD pair moves above the 1.2830 level, buyers are likely to test towards the 1.2866 and 1.2900 resistance levels.

EUR/USD

Current level - 1.1367

The overall bias remains bearish below 1.1430 and crucial on the upside is 1.1490 high. A break through the latter will signal a reversal and will challenge 1.1730 area. Key support lies at 1.1300.

USD/JPY

Current level - 112.16

Yesterday's rise failed to break through 112.70 peak, so there is a risk of another dip to 111.60. A break through 112.40 will signal a rise towards 113.50.

GBP/USD

Current level - 1.2806

The downtrend remains intact and there is still no sign of a reversal. Initial resistance  lies at 1.2870 and crucial on the upside is 1.2940. Next major support below 1.2800 is projected at 1.2660.

The Japanese yen advanced on risk aversion in early Friday's trading and tests again key supports at 112.00 zone (trendline support / 55SMA) which so far resisted several attacks. Despite fresh weakness, mixed daily techs do not provide firmer direction signal, with close below 55SMA/trendline, needed weaken near-term structure for test of key supports at 111.62/56 (15 Oct low/Fibo 61.8% of 109.77/114.54/rising 100SMA). Sustained break here would provide stronger signal for continuation of bear-leg from 114.54 (03/04 Oct highs). The pair is on track for bearish weekly close and form bearish engulfing pattern on weekly chart, which would generate negative signal. Broken 10SMA (112.32) is expected to cap and maintain negative bias, while break higher would ease pressure. Bounce above 112.78 (converged 20/30SMA) would neutralize bears and shift focus higher.

Res: 112.32, 112.44, 112.78, 112.88
Sup: 112.00, 111.81, 111.56, 110.90

Bears are taking a breather around 1.2811 (broken Fibo 76.4% of 1.2661/1.3297 rally) after strong bearish acceleration in past two days cracked psychological 1.2800 support and posted new seven-week low at 1.2796 but failed to close below 1.281 Fibo support. Narrow consolidation signals that bears remain firmly in play, as concerns about complete collapse of Brexit talks soured the sentiment and triggered strong sell-off and limited consolidative/corrective action could offer better selling opportunities. Adding to negative outlook is firm bearish setup of daily techs, with further negative signal expected from strong bearish weekly close (the biggest weekly fall since the first week of August). Close below 1.2811 pivot would expose key support at 1.2661 (15 Aug low) violation of which would signal completion of 1.2661/1.3297 corrective phase and open way for extension of extension of larger downtrend from 1.4376 (2018 high, posted on 17 Apr). Strong resistances at 1.2904 (broken Fibo 61.8%) and 1.2921 (former higher base) are expected to cap extended upticks.

Res: 1.2825, 1.2890, 1.2904, 1.2921
Sup: 1.2811, 1.2796, 1.2729, 1.2697

Pivot (invalidation): 5.6600

Our preference Short positions below 5.6600 with targets at 5.6080 & 5.5800 in extension.

Alternative scenario Above 5.6600 look for further upside with 5.7050 & 5.7400 as targets.

Comment A break below 5.6080 would trigger a drop towards 5.5800.

Pivot (invalidation): 0.7060

Our preference Short positions below 0.7060 with targets at 0.7020 & 0.7000 in extension.

Alternative scenario Above 0.7060 look for further upside with 0.7075 & 0.7100 as targets.

Comment The RSI has broken down its 30 level.

Pivot (invalidation): 1.3065

Our preference Long positions above 1.3065 with targets at 1.3150 & 1.3175 in extension.

Alternative scenario Below 1.3065 look for further downside with 1.3035 & 1.3010 as targets.

Comment The RSI calls for a new upleg.

Pivot (invalidation): 0.9980

Our preference Long positions above 0.9980 with targets at 1.0015 & 1.0035 in extension.

Alternative scenario Below 0.9980 look for further downside with 0.9960 & 0.9940 as targets.

Comment The RSI lacks downward momentum.

Pivot (invalidation): 112.45

Our preference Short positions below 112.45 with targets at 112.20 & 112.00 in extension.

Alternative scenario Above 112.45 look for further upside with 112.65 & 112.85 as targets.

Comment The RSI is bearish and calls for further downside.

Pivot (invalidation): 1.2865

Our preference Short positions below 1.2865 with targets at 1.2795 & 1.2750 in extension.

Alternative scenario Above 1.2865 look for further upside with 1.2920 & 1.2970 as targets.

Comment A break below 1.2795 would trigger a drop towards 1.2750.