Scenario 1: Political instability continues to weigh on sterling. Prices head towards yearly lows between 1.2475/1.2430. Before here, do look out for possible trend support at 1.2535. 1.2581 has before been a major support/resistance area, it’s not far off, what’s going to stop this free fall?
Scenario 2: For a bit of respite you will need to see this pushing back above the daily pivot 1.2668 then a push through 1.2684/.2720. We saw a brief push through 1.2750/60 before, if we get through here again then we may target the weekly pivot at 1.2823.
Chart: Chaos in UK politics giving bulls a real hard time. Daily chart show prices pushing down to yearly lows.
Scenario 1: Testing 1.1144/34 that was also Tuesday’s, this area has held since 25 April. Yearly low at 1.1111 in focus if we break. Below here we have to go back to May 2017 to find reference levels. Sharp buying from this period, we may start to unwind those gains pushing down to 1.1072,1.1021 and 1.0951.
Scenario 2: It’s so under pressure that it’s hard to see any bullish scenarios. What will start to take the pressure off the downside is if we push above 1.1177/1.1192? The higher end of this level is the weekly pivot, from here we can target 1.1197 then up to the 15/16 May highs at 1.1224. 1.1265 has held highs since 22 April.
Chart: Daily chart showing market trading down to May 2017 levels.
Scenario 1: Heading towards 16/20 May lows at 11,989. If we continue to drop past here, we may test the trend channel low at 11,964. Below here is 11,876/688 which has had plenty of price action since 10 October.
Scenario 2: Break out above the short-term trend resistance at 12,189. 12,218/263 was overcome for a short period last week, pushing up through here again and we may test 12,324. 12,445 is the yearly high which coincided with Sep 2018 high.
Chart: Daily chart showing push down towards lower band of trend channel.
Scenario 1: Through 25,553 we target the 61.8% fib at 25,504. Potential trend support from 26 Dec 2018 through 14 May 2019 comes in at 25,488. Trend support between 25,402/310 and daily lows at 25,345/215 have held since February. 25,000 is a psychological level and has held a few daily lows in Feb.
Scenario 2: Starting to fall away from the weekly pivot so look for a move back above 25,651. 25,750/800 has seen a lot of price action since February. If we manage to get back above here, then we may test the trend resistance (8 May through to 22 may highs) at 25,873. Any higher, then it’s a possible test of the 50% that provided the most recent resistance.
Chart: Four-hour chart showing trend resistance, trend support zone and daily lows.