GBP/USD Technical Analysis: Chance of Downward Pressure

The free collapse of the GBP/USD currency pair continues, and its losses reached the 1.1742 lowest support level for the currency pair in nearly 30 months. It is settling around the 1.1765 level at the time of writing the analysis. Despite the crash, it still has a chance of more downward pressure, especially if the busy US economic calendar or comments from Federal Reserve (Fed) officials allow US bond yields and the dollar to add to the gains.

The British pound was not helped by better-than-expected UK economic data and a sharp increase in market expectations for interest rates at the Bank of England (BoE) last week, often appearing to be the most vulnerable among the major currencies to a rebound in US bond yields and the US dollar. This was after a chorus of votes from the Federal Reserve’s rate-setting committee reminded the market in public comments that there was still a risk that the bank would opt for a straight 0.75% increase in US interest rates next month, stimulating US bond yields and the dollar.

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