On Thursday morning, the GBP/USD currency exchange rate plummeted, as it was announced that the EU and UK trade negotiators had failed to make a deal.
At 09:00 GMT, the currency exchange rate was heading to the combined support of the 200-hour SMA and a weekly simple pivot point at 1.2800.
Economic Calendar
On Thursday, as always the US Unemployment Claims at 12:30 GMT might cause a minor move.
The week will end with a monthly data release. The US Average Hourly Earnings, Non-Farm Employment Change and the Unemployment Rate are scheduled for 12:30 GMT. GBP/USD has moved from 22.8 to 43.0 pips on the announcement.
Click on the link below to see the historical reaction tables.
GBP/USD short-term review
The GBP/USD drop was expected to reach the support levels at the 1.2800 level. Namely, the 200-hour SMA and the weekly simple pivot point.In the case of these technical levels holding the rate from declining, it would trade sideways between 1.2800 and 1.2850 levels.
On the other hand, if the rate drops below 1.2800, it would have no technical support as low as 1.2700, where a 61.80% Fibonacci retracement level was located at. However, the 1.2750 mark could provide psychological support.
Hourly Chart
On the daily candle chart, the pair has additional support of the 100 and 200-day simple moving averages at 1.2755 and 1.2719.
In the meantime, the rate faces additional resistance from the 55-day simple moving average at 1.2997.
Daily chart
Read More: Technical Analysis
Traders are long
Since Wednesday, 54% of trader open position volume on the Swiss Foreign Exchange was in long positions.
Meanwhile, in the 100-pip range around the rate the pending orders were 59% to buy the GBP/USD pair.
Previously, the orders were 69% to buy.
Meanwhile, in the 100-pip range around the rate the pending orders were 59% to buy the GBP/USD pair.
Previously, the orders were 69% to buy.