GBP/USD: a break of 1.4050 is Key for Bears - FXStreet
Valeria Bednarik, chief analyst at FXStreet explained that sterling underperformed its counterparts, weighed by concerns over a possible Brexit, and the GBP/USD pair is at risk of further declines, as the data-triggered rally seen on Thursday was rejected near 1.4200.
Key Quotes:
"Having held a few pips above the 1.4100 level on Friday, the downward risk prevails, most likely until the ends of June when the Referendum will take place.
Technically, the pair has met strong buying interest on declines towards 1.4050 during the last two weeks, making of the level the one to beat to trigger stops and additional slides.
The daily chart presents a limited bearish tone, as the price stands below its 20 SMA, whilst the technical indicators present tepid bearish slopes below their mid-lines.
Short term, the 4 hours chart shows that the price has broken below its 200 EMA, now around 1.4260, while the 20 SMA heads sharply lower above the current price, offering an immediate resistance in the 1.4180 region. In the same chart, the technical indicators have corrected oversold readings, but lost steam within bearish territory.
The immediate support comes at 1.4100, followed by the mentioned 1.4050 level, which if it's broken can lead to an extension below the 1.4000 figure at the beginning of the upcoming week."
