GBP/USD Forecast: Increasing Downward Potential

GBP/USD Forecast: Increasing Downward Potential

31 May 2016, 13:01
Roberto Jacobs

GBP/USD Forecast: Increasing Downward Potential

The Pound surged up to 1.4724 at the beginning of the day, but plummeted to 1.4567, a fresh 5-day low with the London opening, a new telephone poll from ORB, shows that the "leave" vote surged up to the 46%, just 5% below the 51% of "remain" option. The GBP/USD pair however, quickly recovered to stabilize a few pips above the 1.4600 figure.

The 4 hours chart shows that the risk remains towards the downside, as the price is below a bearish 20 SMA whilst the technical indicators turned sharply lower after failing to overcome their mid-lines. The pair has to fall below 1.4560, a strong static support to be able to extend its decline down to the 1.4500/20 region, where some buying interest should halt the decline.


Advances are still seen as selling opportunities up to the 1.4735, with an advance above it probably implying a test of 1.4770, May high.


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