The Pound continues to hover around the 1.3100 level as the market awaits progress relating to the Brexit negotiations between Prime Minister May and the EU. Surprisingly, the positive U.S GDP release did not strengthen the greenback which helped the Pound cool off its drop. The general trend for the currency remains bearish as the U.S continues to show robust economic strength and the Brexit negotiations show no signs of a secure and comfortable EU exit. For today, investors need to focus on the U.S Pending Home Sales figure. A better than expected number will pave the way for a possible break of the 1.30819 support level.
The Sterling continues to point lower after last week's 0.618 Fibonacci retracement rejection. The 0.618 retracement also coincides with a key price action resistance level which made it more difficult for the pair to break above this level. The short-term trend has now shifted towards a downtrend as the pair remains below the 50-period moving average. A break below the 1.30819 support level will pave the way for a drop towards the next support level at 1.30507.
Support: 1.30819 1.30507
Resistance: 1.31622 1.32159