While GBP/USD attempted to hold support at the 1.21 level, selling has picked up steam and the support level has given way. GBP/USD is currently trading at 1.2058, down nearly 1%.
With the drop below 1.21 support, the next target is the October 7th flash crash low at 1.1950.
Today’s decline is taking place as the rally in the dollar has accelerated ahead of President-elect Donald Trump’s first press conference since being elected. With no economic data on the U.S. calendar today, the focus will be on Trump and any detail he may provide regarding his policies. The press conference is due to kick off at 11:00 ET.
Ahead of today’s break of support, the bias in the sterling has remained to the downside, given the looming concern over a hard exit from the European Union. British Prime Minister Theresa May stoked those concerns during an interview last weekend with Sky News.
With Trump’s press conference now imminent, volatility has the potential to pick up further over the near term.
GBP/USD Daily/Hourly Charts