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GBPUSD Plunges Below 1.2700, but Daily Close Is Key

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A few short hours ago, GBPUSD carved a new twenty-month low.

And as I write this, the pound is trading below the 1.2700 range support we’ve been discussing for several weeks.

If sellers can secure a daily close below it, we could see GBPUSD trend lower.

Remember, I use New York close (5 pm EST) charts. Anything else when trading price action can get you in trouble.

Go here to get instant access to the same charts I use to trade price action.

However, I want to caution traders here.

This 1.2700 level is not one you want to try and trade on the intraday charts.

It has held as support since August. A level that significant requires a daily close below it before we can call it broken in my opinion.

As long as GBPUSD is above it on a daily closing basis, 1.2700 will continue to serve as support.

In fact, I wouldn’t be surprised to see the pair close the day back above 1.2700. I don’t think it’s likely, but it would not surprise me given today’s volatility.

Either way, I won’t be trading GBPUSD.

Why?

As has been the case for quite some time, the continuous flow of Brexit talk has triggered an influx in volatility.

Couple that with the thin holiday trade, and you have a recipe for wider spreads and volatile moves in both directions.

That isn’t something I want to take on.

I do think this market could go either way though. And if buyers manage to close GBPUSD back above 1.2700 before the 5 pm EST close, it would attract more bids.

Alternatively, a daily close below 1.2700 would keep the pressure on lower levels including 1.2560 and 1.2410.

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GBPUSD key levels on the daily chart

Leave a Comment:

24 comments
gareth says

i think this is still bearish

Reply
    Justin Bennett says

    I didn’t say it isn’t bearish. I’m simply stating that the daily close will give us more information.

    Reply
      Nichi says

      I think it make new low of 2018

      Reply
gareth says

thank you

Reply
    Justin Bennett says

    You’re welcome.

    Reply
Morero says

Thanks Mr Justin Bennett……

Reply
Suresh krishna says

Thanks for useful information I am long from 32000 level can u suggest me something?

Reply
    Justin Bennett says

    You’re welcome. That’s your decision to make.

    Reply
Domitilla says

Thanks to you, I was awake all night.Because I have an open position.Thanks you God bless you.

Reply
Emmanuel says

Definitely, I don’t see it closing above 1.27 again on a daily. It’s going to close below it.

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Chris says

The postponed brexit vote did not help either

Reply
Antony Morgan says

its bearish ,you’re tl was wrong if you do the same line on daily its exact
also
the monthly is bearish
= no
no question mark

Reply
    Justin Bennett says

    If you’re an end-of-day trader, everything before the 5 pm EST close is tentative, hence the question mark.

    Reply
Al says

I see this short now to a measured objective in the region of 1.2060

Reply
Celestine says

Good and highly educative analysis. Keep it up.

Reply
    Justin Bennett says

    Cheers. Thanks for the comment.

    Reply
Boniface says

Its helpful

Reply
    Justin Bennett says

    Glad to hear it.

    Reply
Kenny Jay says

Im in profit . i use to check for news coming . all gbp pairs .

Reply
sameh says

Dear Justin
Thank you for your setups
Is it going to 1.24 ? can it go lower than that?

Reply
    Justin Bennett says

    It can always go lower…

    Reply
Akinbola Sunday says

I quite appreciate this analysis. It is helpful.

Reply
    Justin Bennett says

    Glad to hear it.

    Reply
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