- GBP / USD capped below 1.2200, leaves the support level of 1.2165 exposed.
- Concerns about the COVID-19 crisis and the consequences of Brexit are weighing on the pound.
- The breach of 1.2245 level confirms a double peak formation and increases the downward pressure on the GBP.
Pound reverted to April low at 1.2165, where pair found support to gain ground in Thursday’s US session but without follow-up, GBP / USD turned RIGHT above 1 , 2200 to focus on the support level of 1.2165 mentioned.
The British pound remains weighed by the consequences of Brexit and COVID-19
The pound is trending sharply down against the US dollar, nearing the end of a streak of four consecutive losses in which the pair depreciated by about 1.6%. Concerns about the impact of the COVID-19 crisis in the UK, combined with imminent fears of the consequences of Brexit are driving investors away from the pound.
Today, GBP / USD was also weighed by US dollars strength in a session dominated by risk aversion. In addition, comments by US President Trump on rising tensions with China and its support for a stronger dollar have added downward pressure on the pound.
GBP / USD confirms double peak below 1.2245
The pound confirmed on Wednesday a double high at 1.2643 / 47 after crossing the April 21 low at 1.2250, focusing on the April low at 1.2165. Below, the pair could aim at 1.2030, the 50% retracement of the March-April rally and the March 25 high at 1.1975. On the upside, the pair should come back above 1.2250 to ease the downward pressure, and especially here, aim for 1.2340 (13 May high) and 1.2377 (May 12 high).