The GBPUSD is breaking below a critical support level today.
We discussed this short-term ascending trend line that extends from the November 2019 low in Saturday’s forecast video.
Here is the GBPUSD segment from that video:
At the moment, that trend line comes in a few pips above the 1.3000 handle.
But remember that ascending channel support from the 2019 low sits just below that 1.3000 area.
We even have a key horizontal level at 1.2980.
Notice how 1.2980 capped every advance from the GBPUSD in October and November of last year.
The intersection of these three levels creates a confluence of support.
That area spans from 1.2960 to 1.3010.
It’s going to take a daily close below that 1.2960 to 1.3010 region to confirm the breakdown and expose lower levels.
A close below this support area would open the door to the 1.2770 region with a break below that exposing 1.2570.
Key resistance as of this writing remains 1.3170.
Last but certainly not least, keep in mind that this Thursday’s BOE decision and statement are likely to trigger an increase in volatility.
If those events don’t stir things up, Friday’s Brexit probably will.
This leaves the GBPUSD teetering on a confluence of support ahead of some heavy-hitting events.
Given the price action of late and what we’ve seen from other pairs, a break lower seems imminent.