Technical Analysis: GBPUSD extends losses amid Brexit deadlock, new strain of covid
GBPUSD remains on the back foot on Monday amid grave concerns over Brexit and the new strain of the coronavirus (COVID-19) in the UK. While the EU-UK policymakers failed to overcome differences over fisheries, a fresh version of the covid leads multiple countries, including key European members, Turkey, Canada and Hong Kong, to ban flights from Britain. Not only the fundamentals but downward sloping RSI and MACD signals also suggest the Cable’s further downside. In doing so, 200-bar SMA and an upward sloping trend line from November 02, respectively around 1.3300 and 1.3180, gains the bears’ attention. However, the pair’s further declines will have to conquer the monthly low of 1.3133 to retake the controls.
Meanwhile, the 1.3400 and Friday’s low near 1.3470 will challenge corrective recovery, if at all the Brussels-London due manages to surprise the markets. Also acting as the key upside hurdle is the horizontal area between 1.3540/55 and the monthly high near 1.3625. Overall, a pullback from the multi-month high, flashed during the last week, is likely to extend amid pessimism over Brexit and the virus. Though, hopes of US stimulus and vaccine updates may test bears before the year-end holiday season.