GBPUSD Outlook: Sterling Slumps on Signals of Brexit Talks Stall

Technical analysis of Forex market

Sterling crashed on Friday, losing 1.45% for the day so far, on dip to session low at 1.3063, driven by signals that Brexit talks stalled. UK PM May said the UK and EU Brexit negotiations are at an impasse after the EU rejected proposals from Britain and offered no alternative. May also said that the UK will continue preparations for scenario on no-deal Brexit. Cable’s fall is for now the biggest one-day loss since 02 Nov 2017. Fresh bearish acceleration pressures key supports at 1.3066/55 (daily cloud top / Fibo 38.2% of 1.2661/1.3297 ascend, firm break of which would generate fresh bearish signal for further weakness. Weaker daily techs, with slow stochastic in vertical descend and momentum heading south and creating bear-cross, add to negative outlook. Fresh weakness also changes the picture on daily chart, as the pair is on track for the first negative weekly close after five weeks of strong rally. Strong bearish sentiment is building and could cause further losses, with penetration of thick daily cloud to expose converged 20/55SMA’s at 1.3010 zone and psychological 1.30 support.

Res: 1.3134; 1.3172; 1.3214; 1.3276
Sup: 1.3054; 1.3010; 1.3000; 1.2980